The Millennium Development Goals have moved poverty reduction to the top of donor organisations. list of priorities. Failure to achieve the MDGs will no doubt place the spotlight on their financial commitment to the goals, but effective poverty
reduction relies as much on the knowledge of poverty and poverty reduction that emerges from, and informs, the activities of donor organisations in developing countries as it does on financial resources. Such knowledge is central to defining the parameters and ambition of the poverty reduction strategies of donor organisations. How then do donor organisations generate knowledge about poverty and poverty reduction in the countries in which they work? How do they learn from local networks sustaining both research and action on poverty? How do they use this knowledge in their operations? Notwithstanding the slowly growing literature on the ethnography of aid organizations, these issues have rarely been tackled directly, although we can presume there is a scattered literature on these issues in internal reports of donor organisations. The paper considers these questions in the context of the World Bank's Country Programme in Indonesia.
The aim of the paper is not to produce a generalisable set of findings, but instead to provide an insight into how these questions can be answered within the context of a specific case study. A case study approach is particularly legitimate for asking such questions, because the kind of knowledge generated by donor organisations operating in developing countries addresses local issues and conditions, is to an important extent, locally produced, and the parameters for knowledge generation are influenced
strongly by local organisational features. A case study approach is more likely to identify the main features of such country level knowledge generation on poverty. Another important reason for adopting this approach is to throw light on issues
seldom illuminated in the general literature on donor organisations. Whilst there is a great deal of literature touching on the perspective and approach of particular donor organisations at the macro- level, there is much less information on the extent to
which macro and micro level factors combine to determine the way in which donor organisations operating in-country produce local knowledge. The process of knowledge generation in 'satellite' parts of donor organisations may, and perhaps should, diverge in important ways from the same process in the 'metro' parts of donor organisations. At the very least, this is an important issue to explore.
This paper draws on work, conducted during 2003 and 2004, that sought to understand how the country programme of one donor organization (the World Bank) that is deeply committed to the MDGs generated knowledge on poverty and poverty reduction in that country, and the ways in which that knowledge production interacted with project operations.1 The work was conducted in Indonesia, one of the World Bank's most important country programmes and a country with which the institution has a longstanding relationship - a relationship that has enjoyed periods both of great success and of serious reversal in poverty reduction. It is also an atypical country programme in that analytical work on poverty reduction has not been dominated by (largely economist) staff working within the Bank's Poverty Reduction and Economic
Management network but rather by a broader group of social scientists and economists working in different parts of the institution. It therefore lends itself to a reflection on the implications of different organizational, intellectual and social entry points for generating knowledge on poverty in a given country.
The paper is divided into three sections. The first section provides background information on poverty trends in Indonesia and traces the evolution of the approach to poverty in our selected donor organisation. The second section analyses the main
sources and determinants of knowledge generation on poverty in our selected donor organisation. The last section focuses on identifying the linkages existing between knowledge and operations. A set of conclusions complete the paper.
We are grateful to the support of many people as we did this work, while acknowledging that not all agreed with our conclusions. In particular our thanks to Jehan Arulpragasam, Palmira Bachtiar, Leni Dharmawan, Richard Edwards, Donata Garrasi, Scott Guggenheim, Peter Owen and Andrew Steer. A longer version of the argument can be found in Bebbington and Barrientos (2004).