Which domestic factors influence how much foreign aid a donor country gives to a developing country? We know that aid is not only an instrument to alleviate poverty and promote economic development. Donors also use it to pursue their own self-interested objectives. Yet it is not clear how domestic actors determine the criteria according to which they provide assistance. In this paper we study the impact of partisan politics on trade-oriented foreign aid allocation. Government parties have distinct support–coalitions, which put different weights on specific social and economic policies. This is reflected in a government’s pattern of aid allocation, with right-leaning parties relying more heavily upon foreign aid to promote foreign economic interests than leftist parties. We test the argument on a dyadic dataset of 27 donor countries and 94 developing countries between 1981 and 2007. Using a fractional logit approach, we find empirical support for our argument.
