How Effective Is The Current Regulation Of International Financial Aid Case Study

Introduction:
Foreign financial development aid has been a contentious topic of discussion for over seventy years now. Its form has changed drastically over these years. From the implementation of the ‘Colonial Development Act’ to the ‘Marshall Plan’ in 1948 to the modern form of international financial aid, it is now almost unrecognizable from its beginnings. The central question of this essay is ‘How Effective is the Current Regulation of International Financial Aid?’ In order to answer this question, and subsequently write this paper I will address three key points. I will discuss why the market is regulated (resulting externalities). I will then cover how it is regulated and what instruments are used. I then outline the costs and benefits of the regulation in order to review the consequences for both society and the economy. This essay will also look for incentives (or lack of) available that would encourage the implementation of these regulations. The conclusion will include the answer to my central question; which is that although there has been some positive results, overall the instruments used have failed to do that they were designed to do and in order for the regulation to be more efficient then the both
‘Structural Adjustment Plans’ (SAPs) are one clear example of these policies that are ideologically driven. They are part of a neoliberal ideology, and are used to ‘’promote export-oriented development in a rapidly opened economy’’. These policies have since been described as ‘A Spiralling Race to the Bottom’. The impact of these preconditions on poorer countries were devastating. They expanded ‘’poverty, inequality and insecurity around the world.’’ It could be somehow understandable tying aid on condition of improving human rights, or democracy, but when tied to economic ideology it becomes morally