Food Aid Procurement and Transportation Decision-making in Governmental Agencies: The United Nations/EU versus the United States Approach

This paper conceptually and empirically examines sourcing food aid, comparing the approaches promoted by the U.S. with those of the United Nations (UN) and the European Union (EU). In the recipient country approach (RCA) promoted by the UN and the EU, Transaction Cost Economics (TCE) suggests that RCA provides faster aid with less transaction costs. In the donor country approach (DCA) practiced by the U.S., the Resource-Based View (RBV) suggests that the superior resources of a donor country assure higher quality, safer, and a plentiful food supply. Using a comparative case analysis with actual data provided by the United States Agency for International Development (USAID), we provide evidence that RCA and DCA as practiced in reality are both sub-optimal. Improved sourcing and transportation options computed through quantitative methods can offer significant benefits over both approaches. We propose a contingency approach that reduces landed costs of food aid by giving governmental relief organizations more flexibility in RCA vs. DCA sourcing, which can be justified by Resource Dependency Theory (RDT). Our findings contribute to the decision-making and policy discussion about the efficiency of governmental food aid programs