Royal Armoured Corps Tank Museum [guide] : an illustrated by Royal Armoured Corps Tank Museum

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N. 1007/978-1-4614-6582-9_2 25 26 2 Aid Effectiveness and the Soft Budget Constraint EU aid bureaucrats have worked collectively with federal, regional, and local bureaucrats in post-Soviet recipient economies to achieve common policy ends. Aid effectiveness is to be assessed not only in terms of the foreign policy preferences of the donor, but also in terms of the economic policy preferences of the recipient. In the formal section of this chapter, I focus on the analysis of EU development aid as the new soft budget constraint to the economies of the former Soviet Union.

2, I analyze the coordination between developmental entrepreneurs and distributive planners from the perspectives of transnational sovereignty and monitoring institutions of the European Union. In Sect. 3, I review the literature of the soft budget constraint in planned and transition economies. I draw the analogies between the economics of socialism and post-socialism by defining EU development aid as a new form of a soft budget constraint in transition economies. 4 proposes a formal definition of aid effectiveness in the light of the soft budget constraint literature.

This type of development aid may be useful for economies with a weakly institutionalized environment; nevertheless, it has counterproductive results for the modernization and institutional transformation of transition economies whose communist past provided them with increased levels of egalitarianism in the public sector and a pre-existing social class, the economic bureaucracy of the Soviet Union. 24 Action Programs usually run per fiscal year, although there has been at least one instance that they have been decided on a multiannual basis.

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