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Aid and the Delegated Fight against Terrorism

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  • Azam, Jean-Paul
  • Delacroix, Alexandra

Abstract

A positive empirical relationship is found between the level of foreign aid received by a country and the number of terrorist attacks originating from it. A simple model is used to explain it, where the donor delegates some actions against terrorism to the aid-recipient government. Aid is endogenous in an econometric equation explaining participation in terrorist events, as expected from the model, and an attacks-supply curve in which aid has a negative impact is presented at the end. Copyright � 2006 The Authors; Journal compilation � 2006 Blackwell Publishing Ltd.

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Bibliographic Info

Paper provided by Institut d'Économie Industrielle (IDEI), Toulouse in its series IDEI Working Papers with number 324.

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Date of creation: 2004
Date of revision: Jul 2005
Publication status: Published in Review of Development Economics, vol. 10, n°2, avril 2006, p. 330-344.
Handle: RePEc:ide:wpaper:3381

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  1. Robert K. Fleck & Christopher Kilby, 2006. "World Bank Independence: A Model and Statistical Analysis of US Influence," Review of Development Economics, Wiley Blackwell, vol. 10(2), pages 224-240, 05.
  2. Alan B. Krueger & Jitka Maleckova, 2003. "Education, Poverty and Terrorism: Is There a Causal Connection?," Journal of Economic Perspectives, American Economic Association, vol. 17(4), pages 119-144, Fall.
  3. Azam, Jean-Paul & Laffont, Jean-Jacques, 2003. "Contracting for aid," Journal of Development Economics, Elsevier, vol. 70(1), pages 25-58, February.
  4. Feyzioglu, Tarhan & Swaroop, Vinaya & Zhu, Min, 1998. "A Panel Data Analysis of the Fungibility of Foreign Aid," World Bank Economic Review, World Bank Group, vol. 12(1), pages 29-58, January.
  5. Berthelemy, Jean-Claude & Tichit, Ariane, 2002. "Bilateral Donors' Aid Allocation Decisions: A Three-dimensional Panel Analysis," Working Papers UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
  6. Svensson, Jakob, 2003. "Why conditional aid does not work and what can be done about it?," Journal of Development Economics, Elsevier, vol. 70(2), pages 381-402, April.
  7. Azam, Jean-Paul, 2003. "Suicide-Bombing as Inter-Generational Investment," IDEI Working Papers 234, Institut d'Économie Industrielle (IDEI), Toulouse.
  8. Chauvet, Lisa, 2003. "Socio-political instability and the allocation of international aid by donors," European Journal of Political Economy, Elsevier, vol. 19(1), pages 33-59, March.
  9. Svensson, Jakob, 2000. "When is foreign aid policy credible? Aid dependence and conditionality," Journal of Development Economics, Elsevier, vol. 61(1), pages 61-84, February.
  10. C. S. Adam & S. A. O'Connell, 1999. "Aid, Taxation and Development in Sub-Saharan Africa," Economics and Politics, Wiley Blackwell, vol. 11(3), pages 225-253, November.
  11. Nakamura, Alice & Nakamura, Masao, 1981. "On the Relationships among Several Specification Error Tests Presented by Durbin, Wu, and Hausman," Econometrica, Econometric Society, vol. 49(6), pages 1583-88, November.
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