by Isaac Post
April 1, 2006

Full document available in pdf.

The Millennium Challenge Corporation (MCC) is a foreign aid initiative that was conceived with the view that economic growth is the essential ingredient for eliminating poverty in developing countries. Unlike previous foreign aid programs, the MCC encourages this process by limiting aid to a country that demonstrates a commitment to good governance, economic freedom and investments in its people. But the MCC’s interpretation of environmental issues echoes the thinking of the “old” foreign aid from which it was supposed to differ. 

New economic research regarding the relationship between economic growth and the environment, and the role of institutions in economic development underscores the inadequate foundation upon which this interpretation lies. It is suggested that the MCC’s concerns can be met with a focus on private property rights, as their recognition allows for the rational balancing of trade-offs that is essential for wise environmental stewardship. 

Related Files:

• This article in PDF