IDEAS home Printed from https://ideas.repec.org/p/ags/aaea16/235859.html
   My bibliography  Save this paper

How wealth of nations interact with aid and peace: A time and country variant analysis

Author

Listed:
  • Kibriya, Shahriar
  • Zhang, Yu
  • Bessler, David
  • Price, Edwin

Abstract

By using panel VAR model and directed acyclic graphs (DAGs), we explore the dynamic interdependences among aid, development, and conflict. We construct a worldwide panel dataset of 79 countries over the period 1995-2010. Although foreign aid is sensitively responsive to the conflict or development shock, its effects on reducing conflict and improving development are largely relied on the wealth level and conflict proneness of the recipient country. We find that foreign aid only mitigates conflict in middle income developing countries, and enhances the development of the poor and conflict-prone countries.

Suggested Citation

  • Kibriya, Shahriar & Zhang, Yu & Bessler, David & Price, Edwin, 2016. "How wealth of nations interact with aid and peace: A time and country variant analysis," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235859, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea16:235859
    DOI: 10.22004/ag.econ.235859
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/235859/files/pvar_2016%20aaea.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.235859?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Paul Collier & Anke Hoeffler, 2002. "On the Incidence of Civil War in Africa," Journal of Conflict Resolution, Peace Science Society (International), vol. 46(1), pages 13-28, February.
    2. Collier, Paul & Hoeffler, Anke, 1998. "On Economic Causes of Civil War," Oxford Economic Papers, Oxford University Press, vol. 50(4), pages 563-573, October.
    3. Arellano, Manuel & Bover, Olympia, 1995. "Another look at the instrumental variable estimation of error-components models," Journal of Econometrics, Elsevier, vol. 68(1), pages 29-51, July.
    4. Paul Collier & Anke Hoeffler, 2004. "Greed and grievance in civil war," Oxford Economic Papers, Oxford University Press, vol. 56(4), pages 563-595, October.
    5. M. Hashem Pesaran, 2007. "A simple panel unit root test in the presence of cross-section dependence," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(2), pages 265-312.
    6. Svensson, Jakob, 2000. "Foreign aid and rent-seeking," Journal of International Economics, Elsevier, vol. 51(2), pages 437-461, August.
    7. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    8. Christopher Blattman & Edward Miguel, 2010. "Civil War," Journal of Economic Literature, American Economic Association, vol. 48(1), pages 3-57, March.
    9. Lof, Matthijs & Mekasha, Tseday Jemaneh & Tarp, Finn, 2015. "Aid and Income: Another Time-series Perspective," World Development, Elsevier, vol. 69(C), pages 19-30.
    10. William Easterly, 2002. "The cartel of good intentions: The problem of bureaucracy in foreign aid," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 5(4), pages 223-250.
    11. Collier, Paul, 2008. "The Bottom Billion: Why the Poorest Countries are Failing and What Can Be Done About It," OUP Catalogue, Oxford University Press, number 9780195374636.
    12. Bethany Lacina & Nils Petter Gleditsch, 2005. "Monitoring Trends in Global Combat: A New Dataset of Battle Deaths," European Journal of Population, Springer;European Association for Population Studies, vol. 21(2), pages 145-166, June.
    13. William Easterly & Ross Levine & David Roodman, 2004. "Aid, Policies, and Growth: Comment," American Economic Review, American Economic Association, vol. 94(3), pages 774-780, June.
    14. David Dollar & Craig Burnside, 2000. "Aid, Policies, and Growth," American Economic Review, American Economic Association, vol. 90(4), pages 847-868, September.
    15. de Ree, Joppe & Nillesen, Eleonora, 2009. "Aiding violence or peace? The impact of foreign aid on the risk of civil conflict in sub-Saharan Africa," Journal of Development Economics, Elsevier, vol. 88(2), pages 301-313, March.
    16. Paul Collier & V. L. Elliott & Håvard Hegre & Anke Hoeffler & Marta Reynal-Querol & Nicholas Sambanis, 2003. "Breaking the Conflict Trap : Civil War and Development Policy," World Bank Publications - Books, The World Bank Group, number 13938, December.
    17. Katarina Juselius & Niels Framroze Møller & Finn Tarp, 2014. "The Long-Run Impact of Foreign Aid in 36 African Countries: Insights from Multivariate Time Series Analysis," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 76(2), pages 153-184, April.
    18. Nicholas Sambanis, 2002. "A Review of Recent Advances and Future Directions in the Quantitative Literature on Civil War," Defence and Peace Economics, Taylor & Francis Journals, vol. 13(3), pages 215-243.
    19. Bessler, David A. & Yang, Jian, 2003. "The structure of interdependence in international stock markets," Journal of International Money and Finance, Elsevier, vol. 22(2), pages 261-287, April.
    20. Edward Miguel & Shanker Satyanath & Ernest Sergenti, 2004. "Economic Shocks and Civil Conflict: An Instrumental Variables Approach," Journal of Political Economy, University of Chicago Press, vol. 112(4), pages 725-753, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Richard Bluhm & Martin Gassebner & Sarah Langlotz & Paul Schaudt, 2021. "Fueling conflict? (De)escalation and bilateral aid," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 36(2), pages 244-261, March.
    2. Timothy Besley & Torsten Persson, 2011. "Pillars of Prosperity: The Political Economics of Development Clusters," Economics Books, Princeton University Press, edition 1, number 9624.
    3. Koppenberg, Maximilian & Mishra, Ashok K. & Hirsch, Stefan, 2023. "Food Aid and Violent Conflict: A Review of Literature," IZA Discussion Papers 16574, Institute of Labor Economics (IZA).
    4. Serhan Cevik & Mohammad Rahmati, 2015. "Breaking the Curse of Sisyphus: An Empirical Analysis of Post-Conflict Economic Transitions," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 57(4), pages 569-597, December.
    5. Christopher Blattman & Edward Miguel, 2010. "Civil War," Journal of Economic Literature, American Economic Association, vol. 48(1), pages 3-57, March.
    6. Boateng, Elliot & Agbola, Frank W. & Mahmood, Amir, 2021. "Foreign aid volatility and economic growth in Sub-Saharan Africa: Does institutional quality matter?," Economic Modelling, Elsevier, vol. 96(C), pages 111-127.
    7. Ahsan Kibria & Reza Oladi & Sherzod B. Akhundjanov, 2020. "Foreign direct investment and civil violence in Sub‐Saharan Africa," The World Economy, Wiley Blackwell, vol. 43(4), pages 948-981, April.
    8. Carolyn Chisadza & Manoel Bittencourt, 2016. "Globalisation and Conflict: Evidence from sub-Saharan Africa," Working Papers 634, Economic Research Southern Africa.
    9. Daron Acemoglu & Leopoldo Fergusson & Simon Johnson, 2017. "Population and Civil War," NBER Working Papers 23322, National Bureau of Economic Research, Inc.
    10. J Paul Dunne & Nan Tian, 2016. "Determinants of Civil War and Excess Zeroes," SALDRU Working Papers 191, Southern Africa Labour and Development Research Unit, University of Cape Town.
    11. Richard Bluhm & Martin Gassebner & Sarah Langlotz & Paul Schaudt, 2021. "Fueling conflict? (De)escalation and bilateral aid," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 36(2), pages 244-261, March.
    12. Robert MacCulloch & Silvia Pezzini, 2010. "The Roles of Freedom, Growth, and Religion in the Taste for Revolution," Journal of Law and Economics, University of Chicago Press, vol. 53(2), pages 329-358, May.
    13. Alou Adessé Dama, 2021. "Exploring Tilly’s Theory : Violent Conflicts and Tax Revenue in Sub-Saharan Africa," CERDI Working papers hal-03401539, HAL.
    14. Domingues Patrick, 2011. "A Database on the Mozambican Civil War," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 17(1), pages 1-32, May.
    15. Carolyn Chisadza & Matthew Clance, 2021. "Conflict heterogeneity in Africa," South African Journal of Economics, Economic Society of South Africa, vol. 89(4), pages 459-479, December.
    16. Issifou, Ismael, 2017. "Can migration reduce civil conflicts as an antidote to rent-seeking?," Economic Systems, Elsevier, vol. 41(3), pages 333-353.
    17. Matteo Cervellati & Sunde, Uwe & Simona Valmori, 2011. "Disease Environment and Civil Conflicts," Economics Working Paper Series 1113, University of St. Gallen, School of Economics and Political Science.
    18. Camille Laville, 2018. "The econometrical causal analysis of internal conflicts: The evolutions of a growing literature [L’analyse économétrique des conflits internes par l’approche causale : les évolutions d’une littérat," Working Papers hal-01940461, HAL.
    19. Douch, Mustapha & Edwards, Huw & Landman, Todd & Mallick, Sushanta, 2022. "Aid effectiveness: Human rights as a conditionality measure," World Development, Elsevier, vol. 158(C).
    20. Markus Brückner & Antonio Ciccone, 2010. "International Commodity Prices, Growth and the Outbreak of Civil War in Sub-Saharan Africa," Economic Journal, Royal Economic Society, vol. 120(544), pages 519-534, May.

    More about this item

    Keywords

    International Development;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:aaea16:235859. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/aaeaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.