The Risk of Resource Misappropriation in Community-Based Development Projects.

Community-Driven Development (CDD) is being currently proposed as the main avenue to fighting poverty and circumventing the shortcomings of state-directed aid resources. One of the main difficulties in CDD programmes lies in their vulnerability to capture by local elites. The paper discusses the possibility of mitigating this problem through a so-called leader-disciplining mechanism (LDM) that relies on a sequential disbursement procedure supported by a fraud detection mechanism. On the basis of the LDM framework, it is argued in particular that too quick and massive a rush on CDD may prove self-defeating in the sense that the share of aid resources actually reaching the poor will be low if donor agencies are impatient to achieve results.