The always entertaining Richard Posner (prior posts here) weighs in on the efficacy of foreign aid:

I do not favor foreign aid, debt relief (which is simply another form of such aid), or other financial transfers to poor countries, in Africa or anywhere else. Countries that are not corrupt do not require foreign aid, and foreign aid to corrupt countries entrenches corruption by increasing the gains to corruption. Foreign aid to Zimbabwe, for example, will simply prop up dictator Mugabe.
Foreign aid makes people in wealthy countries feel generous, but retards reform in those countries as well as in the donee countries. . .

Meanwhile, over at Mahalanobis, Michael Stasny refers to this Bill Easterly paper on foreign aid (pdf):

If Zambia had converted all the aid it received since 1960 to investment and all of that investment to growth, it would have had a per capita GDP of about $20,000 by the early 1990s. Instead, Zambia?s per capita GDP in the early 1990s was lower than it had been in 1960, hovering under $500.

To which Tyler Cowen reminds us that, as of 1960 or so, Zambia and South Korea had roughly the same standard of living.