Political economy analysis, aid effectiveness and the art of development management

Recognising that aid effectiveness critically depends upon the quality of host-country institutions and policies, international aid agencies have sought to inform their activities through more systematic political-economy analysis (PEA). In this article, three analytical frameworks for PEA are compared, contrasted and critically appraised in the light of reflections by PEA practitioners and recent theoretical debate about development management. The article finds that the potential of PEA to improve development effectiveness depends on how far it addresses the micro as well as macro politics of aid and permits a finer-grained engagement between analysis and action. This requires more reflexivity on the part of those who commission and produce PEA, and further movement from intervention to interaction modalities for aid delivery.