Institutional Quality, Conflict and Aid Dependency
AbstractThis study attempts to explore the impact of foreign aid on the quality of governance and how conflicts, whether internal or external affect the overall situation. Conflicts affect governance directly by creating instability which adversely affects economic development as investment climate is fouled and output drops leading to fall in revenues. In this vicious cycle governance is left with no funds to improve institutional quality. Annual data from 1984 to 2010 have been used for the Asian developing economies. The results indicate a negative impact from the confluence of foreign aid in a climate of conflicts that leads to institutional deterioration. These results are robust for various alternative specifications.
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Bibliographic InfoPaper provided by Pakistan Institute of Development Economics in its series PIDE-Working Papers with number 2013:94.
Length: 16 pages
Date of creation: 2013
Date of revision:
Official Development Assistance; Governance; Conflict;
Find related papers by JEL classification:
- C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Longitudinal Data; Spatial Time Series
- F35 - International Economics - - International Finance - - - Foreign Aid
- O11 - Economic Development, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
- O43 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
- D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-07-28 (All new papers)
- NEP-CWA-2013-07-28 (Central & Western Asia)
- NEP-SEA-2013-07-28 (South East Asia)
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