The impact of foreign aid, political affiliation, ethnicity and location on welfare inequality in Uganda

Foreign aid is presented as one of the tools to combat poverty and ushering in economic development in developing countries, particularly in the sub-Saharan region. Given the billions of dollars dispatched in form of aid on various developmental and poverty elimination projects, the sub-Saharan region still portrays a good example of most poverty-stricken regions with billions of its population living under the poverty line. This study assesses the effect of foreign aid, political affiliation and ethnicity on welfare inequality in Uganda between 1999 and 2016. I found that foreign aid positive welfare implications for Ugandans who responded positively to the welfare related questions. The incumbent political party supporters and members of the ruling ethnic group have higher odds of experiencing better welfare compared to their counterparts. For the incumbent political party supporters, the odds of having good living conditions was 89 percent higher than the odds of the opposition political party supporters. Also, members of the non-ruling ethnic group who live in the ruling ethnic groups' constituencies have higher odds of having better welfare outcomes compared the non-ruling ethnic groups living in other constituencies. There is little evidence to prove that supporters of the ruling political party, members of the ruling ethnic group and individuals from other ethnic groups living in the ruling ethnic groups districts have higher odds of accessing foreign aid funds hence they experience better welfare outcomes.