Foreign Aid Reduces Labor Supply and Capital Accumulation
AbstractIn an optimal growth model with foreign aid, foreign borrowing, and endogenous leisure-and-consumption choices, it is shown that a permanent rise in foreign aid reduces long-run capital accumulation and labor supply, increases long-run consumption, and has no effect on long-run foreign borrowing.
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Bibliographic InfoPaper provided by China Economics and Management Academy, Central University of Finance and Economics in its series CEMA Working Papers with number 56.
Date of creation: 2001
Date of revision:
Publication status: Published in Review of Development Economics, Volume 5, Issue 1, pages 105¨C118, February 2001
Other versions of this item:
- Gong, Liutang & Zou, Heng-fu, 2001. "Foreign Aid Reduces Labor Supply and Capital Accumulation," Review of Development Economics, Wiley Blackwell, vol. 5(1), pages 105-18, February.
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- Liutang Gong & Heng-fu Zou, 1999.
"Foreign Aid Reduces Domestic Capital Accumulation and Increases Foreign Borrowing: A Theoretical Analysis,"
CEMA Working Papers
8, China Economics and Management Academy, Central University of Finance and Economics, revised Apr 2000.
- Liutang Gong & Heng-fu Zou, 2000. "Foreign Aid Reduces Domestic Capital Accumulation and Increases Foreign Borrowing: A Theoretical Analysis," Annals of Economics and Finance, Society for AEF, vol. 1(1), pages 147-163, May.
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- Cui, Xiaoyong & Gong, Liutang, 2008. "Foreign aid, domestic capital accumulation, and foreign borrowing," Journal of Macroeconomics, Elsevier, vol. 30(3), pages 1269-1284, September.
- Wenli Cheng & Dingsheng Zhang & Heng-Fu Zou, 2006. "THE EFFECTS OF FOREIGN AID ON THE CREATION AND DISTRIBUTION OF WEALTH Wenli Cheng, Dingsheng Zhang and Heng-Fu Zou," Development Research Unit Working Paper Series 10/06, Monash University, Department of Economics.
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