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The Macroeconomics of Doubling Aid to Africa and the Centrality of the Supply Side

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  • Tony Killick
  • Mick Foster
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    Abstract

    The proposed doubling of aid to Africa by 2010 is a less simple proposition, from a recipient point of view, than is commonly supposed. This article argues that it is difficult to manage large and rapidly increasing aid inflows in ways which do not disadvantage producers of tradeable goods, and the private sector generally. This difficulty can be averted if conscious efforts are made to offset it and to stimulate positive responses from the supply side. Whether such responses prevail over the shorter-term management difficulties depends on the efficacy of state actions - and of aid - to bolster the supply side. The outcome is likely to be mixed, depending on country circumstances. Copyright 2007 Blackwell Publishing Ltd.

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    Bibliographic Info

    Article provided by Overseas Development Institute in its journal Development Policy Review.

    Volume (Year): 25 (2007)
    Issue (Month): 2 (03)
    Pages: 167-192

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    Handle: RePEc:bla:devpol:v:25:y:2007:i:2:p:167-192

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    Cited by:
    1. Henrik Hansen & Derek Headey, 2010. "The Short-Run Macroeconomic Impact of Foreign Aid to Small States: An Agnostic Time Series Analysis," Journal of Development Studies, Taylor & Francis Journals, Taylor & Francis Journals, vol. 46(5), pages 877-896.
    2. Feeny, Simon & de Silva, Ashton, 2012. "Measuring absorptive capacity constraints to foreign aid," Economic Modelling, Elsevier, Elsevier, vol. 29(3), pages 725-733.

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