What explains the fact that the humanitarian response in some crises is well funded, while other humanitarian emergencies are largely neglected? The literature identifies three groups of factors that influence aid allocations: needs in recipient countries, donor countries' interests, and agenda setting driven by media coverage; although there is debate over how relatively important these are.
This study tests existing theory by adding three novel aspects.
First, rather than just measuring the amount of money available, we consider the share of funding that is provided against the stated requirements. Second, we measure humanitarian needs in a more detailed way than has typically been the case. Third, we use datasets that have been underutilized in the academic literature.
By using these three novel approaches, we confirm that all three factors—humanitarian needs, strategic interests, agenda setting—play a role. However, the most consistent factor is media coverage. We are also able to distinguish between different dimensions of need: the number of hosted refugees makes a difference, but the number of displaced people does not. We find that countries with the worst human rights situations attract lower funding levels and more democratic countries attract more funding.
Donors should consider how the factors identified in this study influence their funding decisions in the aggregate. They should be aware of how media coverage may influence their allocations of humanitarian funding. Journalists should be aware of potential biases in their reporting on humanitarian emergencies. Aid agencies should consider counteracting the factors that are associated with underfunded emergencies.
Matching is a commonly used fund-raising tactic, whereby small donors have their donation to a charity matched via a fund established by large donors. I developed a model in which a single large donor decides whether to establish a matching fund or contribute to the public good via the voluntary contributions mechanism (VCM). The credibility of the matching fund is an endogenous component of the model. For a match to be credible, the organizer must have a credible promise not to top up the contributions of the small donors. If the number of small donors is sufficiently large, there always exists a matching fund that is both credible and leads to a Pareto improvement relative to the VCM. When the matching fund needs to satisfy an endogenous credibility constraint, all of the outcomes that are eliminated due to this constraint are outcomes under which small donors are worse off relative to the VCM. The matching fund is also compared with a raffle mechanism. As the number of small donors grows large, public good provision under the two mechanisms converges. However, the matching function outperforms the raffle when there is a finite number of small donors.
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