This paper is an output from a two-year research project on the linkages between Good Governance, New Aid Modalities and Poverty Reduction for the Advisory Board for Irish Aid. The desire to improve aid effectiveness has meant that both governance and aid modalities have moved to the centre of development debates during the past decade. This has also led to corruption becoming more prominent in donor policies and programmes. This paper reviews the literature on corruption, anti-corruption efforts and aid, with a focus on: (i) tools for measuring corruption; (ii) the social science literature on the country-level causes of corruption and its relationship to poor governance; (iii) donor approaches to reducing corruption - both specific anti-corruption interventions and broader governance measures; and (iv) the debates and evidence on aid modalities and corruption.

Ivar Kolstad

Associated Research Professor