Has Assistance from USAID been Successful for Democratization? Evidence from the Transition Economies of Eastern Europe and Eurasia

Over the past 20 years, democracy promotion has become a pillar of USAID's mission. We assess the success of US aid by testing whether it is enhancing democracy in a panel of 26 transition countries. Using Freedom House Nations in Transit data, we find that aid has generally not been a significant factor in a country's overall democracy score, but has significantly contributed to certain components of the democracy score, namely civil society, electoral process, judicial framework, and media independence. In addition, the impact of aid is found to depend on the number of years of past central planning.