Learning What Works
Evaluation is the most direct tool that principals at all types of organizations use to manage the discretion they grant to their agents. Evaluations produce information about the outcomes of decisions and reduce uncertainty about cause-and-effect relationships. This chapter examines whether the results in project evaluations at the multilateral development banks have promoted selectivity in the allocation of environment-improving projects. Under pressure from donor countries to approve environment-improving activities, the multilateral development banks use information about success in evaluations to convince recipient countries to take on more environmental projects with clear local benefits. The same type of information is disregarded for projects that primarily have global benefits, since donor countries have pressured the multilateral development banks to rapidly scale up lending for these types of projects. These results suggest that much of the effort around project evaluation should be directed to meet the information needs of borrowing countries.
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