How does funding influence sectoral and geographic spread of NGOs?
NGOs compete for donor attention and funding; this can influence what they choose to focus on and lead to clustering around more attractive projects.
In this VoxDevTalk, Thierry Verdier examines the motivations of NGO competition and its impact on the development sector, of which NGOs are a significant part. Competition for funding routinely induces NGOs to systemically undercover 'Cinderella projects', which remain chronically underfunded. Is the solution to this problem better coordination on fundraising activities between NGOs or is it government intervention? In a new research paper, he and his co-authors Gani Aldashev and Marco Marini look at aid data to analyse NGO clustering around certain sectors and geographic regions and propose possible mechanisms that influence such behaviour.