ABSTRACT
The rise of ‘private initiatives’ – by NGOs, philanthropic foundations and other civil society groups – has been one of the most striking features of foreign aid over the last ten years, yet (especially in regard to philanthropy) it remains poorly understood and inadequately debated. At a conservative estimate, private aid flows already amount to over $ 25 billion a year, and the trend is rising, so at some point in the future private aid may exceed official development assistance from donor governments. 1 This trend raises significant questions about the impact and accountability of private development assistance, and these questions have been thrown into sharper relief by the recent emergence of ‘philanthrocapitalism’ – the use of business thinking by large new donors to transform philanthropy, coupled with the deployment of market mechanisms on a much larger scale to promote development and social change. This movement tends to eschew traditional, democratic modes of accountability, and has thus far escaped any systematic scholarly or public scrutiny. Foreign aid from NGOs, other civil society groups and traditional philanthropic foundations generates questions of its own, of course, but these questions have at least been raised and debated to some extent in the development literature. Therefore, this chapter focuses on the potential costs and benefits of ‘philanthrocapitalism’ as compared to other forms of private aid.
