This study challenges the traditional donor-recipient model of international aid by proposing a new ‘net aid’ framework that incorporates not only financial inflows such as official development assistance (ODA) and remittances but also often-overlooked outflows of human capital from developing to developed countries. Focusing on Nepal and five donor countries—Australia, Canada, Japan, the UK, and the US—the research quantifies resource exchanges by estimating the economic value of emigrated students and workers based on the cost of raising and educating a child. Using multiple models with varied assumptions, the analysis reveals that Nepal often contributes more in human capital value than it receives in financial aid, effectively reversing the conventional aid flow narrative. The study adopts a critical realist epistemology and a constructivist ontology to examine how entrenched aid narratives shape global power dynamics and state identities. Findings show significant net outflows from Nepal, especially to Australia and Japan, even under conservative scenarios, challenging binary categorizations of “donor” and “recipient” countries. The research advocates for a shift in aid metrics and discourse, calling for policy reforms and a semantic shift reflecting more equitable and multidirectional development cooperation. This re-conceptualization has significant implications for global development policy and international relations.
We appreciate your keen interest in our research insights. Please complete the form with your details to download a copy of the e-book and explore the research’s valuable insights.
