Foreign aid as a tool of foreign policy to achieve foreign policy goals appears to have some supporters and many critics. This subject has traditionally generated more heat than light; this is because of the strong emotional associations to many foreign policy goals such as economic well-being, security, world peace, economic development, etc. What this study presents is a rather comprehensive theory to explain why the United States and other countries give aid for three principal purposes: to increase the wealth of other countries or a particular subset within those countries; to enable recipient governments to bring about and sustain desired changes in their economic and political systems; and thirdly, to achieve certain international economic, social, and political objectives. The most important conclusion to emerge from this research is that the effects of foreign aid are overwhelmingly determined by the motives of the donor government in giving aid during the period in which aid is given. Moreover, with respect to most aid variables, the effects of the motive variables are dramatic. For example, the adverse effects of political defense policies are such that in order for other kinds of reasons to be effective, national security benefits from aid would have to be enormous. Even then, this analysis would suggest that the masses of poor people in the least developed countries have no stake in national security policy. They are not threatened by the Soviet Union. The study of the role of foreign aid in the achievement of foreign policy goals has been divided mainly between those who argue the virtues of giving aid for other purposes and those who emphasize the harm that aid does as well as its failure to do good in the face of its asserted objectives.