Recent debates have focused on the negative role of the proliferation of foreign aid facilities and donor fragmentation for development outcomes and recipient country institutions. This article investigates an overlooked positive side effect of donor proliferation. With an increasing number of donors, exposure to negative aid shocks decreases, as well as the impact of such shocks on violent political conflict. Using data on 106 recipient countries for the years 1970 to 2008 and employing event history and mediation analysis, we find strong evidence that fragmentation significantly reduces the risk for political destabilization associated with aid shocks.
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