Special Interests in Foreign Policy Bureaucracies: Evidence from Foreign Aid

Effective foreign policy necessitates a well-functioning bureaucracy. However, many states fragment foreign policy authority to bureaucratic actors with little interest or expertise in foreign affairs, such as labor, agricultural, and commerce ministries. This is especially common in foreign aid, where research suggests that fragmentation can be deleterious. Why do some states allow their foreign aid bureaucracy to become fragmented? I suggest that the fragmentation of the foreign aid bureaucracy results from domestic distributive politics. Leaders building electoral coalitions can fragment aid to many projects, programs, and bureaucracies to satisfy special interests. Using a novel coding of a bureaucracy-level foreign aid data set, I find that institutions incentivizing distributive politics increase aid fragmentation and that nontraditional aid bureaucracies are more open to distributive politics. I also qualitatively trace the theoretical mechanisms using a case of UK foreign aid. I find that special interests benefit from the existence and empowerment of nontraditional aid bureaucracies.