• Corruption;
  • Foreign aid;
  • Development;
  • Multilateral ODA;
  • Bilateral ODA;
  • International organizations
  • C33;
  • F35;
  • O11

Though many studies have referred to an “anti-corruption movement” beginning in the 1990s by major international organizations, none has empirically tested its effectiveness on corruption. The data show that from 1997 onward, the impact of multilateral aid is strongly and robustly associated with lower corruption levels, while bilateral aid is shown to be an insignificant determinant. An increase in any official development assistance (ODA) pre-1997 is associated with higher levels of corruption or has no impact at all. Using panel data from 1986 to 2006, this study reveals a more nuanced relationship between ODA and corruption than previous studies and demonstrates that when disaggregating the time periods, there are sensitive temporal effects of ODA's effect on corruption overlooked by earlier studies, and provides initial evidence of the effectiveness of the international organization anti-corruption movement in the developing world.