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The political economy of development assistance: peril to government quality dynamics in Africa

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  • Simplice A, Asongu

Abstract

This paper assesses the effectiveness of foreign aid in improving government institutions in 52 African countries using updated data(1996-2010). Findings suggest development assistance deteriorates government quality dynamics of corruption-control, political-stability, rule of law, regulation quality, voice and accountability and government effectiveness. It is therefore a momentous epoque to solve the second tragedy of foreign aid; high time economists and policy makers start rethinking the models and theories on which foreign aid is based. In the meantime, it is up to people who really care about the poor to hold aid agencies accountable for results.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 36543.

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Date of creation: 09 Feb 2012
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Handle: RePEc:pra:mprapa:36543

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Keywords: Foreign Aid; Political Economy; Development; Africa;

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  1. Asongu Simplice, 2011. "Law, finance, economic growth and welfare: why does legal origin matter?," Working Papers 11/007, African Governance and Development Institute..
  2. Simplice A. ASONGU, 2011. "Why Do French Civil–Law Countries Have Higher Levels Of Financial Efficiency?," Journal of Advanced Research in Law and Economics, ASERS Publishing, vol. 0(2), pages 94-108, December.
  3. Asongu Simplice, 2011. "Law and Finance in Africa," Working Papers 11/009, African Governance and Development Institute..
  4. Alesina, Alberto & Dollar, David, 2000. " Who Gives Foreign Aid to Whom and Why?," Journal of Economic Growth, Springer, vol. 5(1), pages 33-63, March.
  5. Addison, Tony & Mavrotas, George & McGillivray, Mark, 2005. "Development Assistance and Development Finance: Evidence and Global Policy Agendas," Working Paper Series RP2005/23, World Institute for Development Economic Research (UNU-WIDER).
  6. Simplice A., Asongu, 2011. "Law, Finance and Investment: does legal origin matter?," MPRA Paper 34698, University Library of Munich, Germany.
  7. Kevin M. Murphy & Andrei Shleifer & Robert W. Vishny, 1988. "Industrialization and the Big Push," NBER Working Papers 2708, National Bureau of Economic Research, Inc.
  8. P. Guillaumont & L. Chauvet, 2001. "Aid and Performance: A Reassessment," Journal of Development Studies, Taylor & Francis Journals, vol. 37(6), pages 66-92.
  9. J.A. Agbor & J. W. Fedderke & N. Viegi, 2010. "How Does Colonial Origin Matter for Economic Performance in sub-Saharan Africa?," Working Papers 176, Economic Research Southern Africa.
  10. William Easterly & Ross Levine & David Roodman, 2003. "New Data, New doubts: A Comment on Burnside and Dollar's "Aid, Policies, and Growth" (2000)," NBER Working Papers 9846, National Bureau of Economic Research, Inc.
  11. Fielding, David & McGillivray, Mark & Torres, Sebastian, 2006. "A Wider Approach to Aid Effectiveness: Correlated Impacts on Health, Wealth, Fertility and Education," Working Paper Series RP2006/23, World Institute for Development Economic Research (UNU-WIDER).
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  15. Easterly, William, 1999. "The ghost of financing gap: testing the growth model used in the international financial institutions," Journal of Development Economics, Elsevier, vol. 60(2), pages 423-438, December.
  16. Easterly, William, 2005. "What did structural adjustment adjust?: The association of policies and growth with repeated IMF and World Bank adjustment loans," Journal of Development Economics, Elsevier, vol. 76(1), pages 1-22, February.
  17. Léonce Ndikumana & Mina Baliamoune-Lutz, 2008. "Corruption and Growth: Exploring the Investment Channel," UMASS Amherst Economics Working Papers 2008-08, University of Massachusetts Amherst, Department of Economics.
  18. Pritchett, Lant & Woolcock, Michael, 2004. "Solutions When the Solution is the Problem: Arraying the Disarray in Development," World Development, Elsevier, vol. 32(2), pages 191-212, February.
  19. René M. Stulz, 1999. "Golbalization, Corporate Finance, And The Cost Of Capital," Journal of Applied Corporate Finance, Morgan Stanley, vol. 12(3), pages 8-25.
  20. Stephen Knack, 2001. "Aid Dependence and the Quality of Governance: Cross-Country Empirical Tests," Southern Economic Journal, Southern Economic Association, vol. 68(2), pages 310-329, October.
  21. Filmer, Deon & Hammer, Jeffrey S & Pritchett, Lant H, 2000. "Weak Links in the Chain: A Diagnosis of Health Policy in Poor Countries," World Bank Research Observer, World Bank Group, vol. 15(2), pages 199-224, August.
  22. Mosley, Paul & Hudson, John & Horrell, Sara, 1987. "Aid, the Public Sector and the Market in Less Developed Countries," Economic Journal, Royal Economic Society, vol. 97(387), pages 616-41, September.
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Citations

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Cited by:
  1. Asongu, Simplice & Jellal, Mohamed, 2014. "International aid corruption and fiscal behavior policy," MPRA Paper 57192, University Library of Munich, Germany.
  2. Asongu, Simplice A, 2013. "Consult your gods: the questionable economics of development assistance in Africa," MPRA Paper 48475, University Library of Munich, Germany.
  3. Simplice A, Asongu, 2012. "Fighting corruption when existing corruption-control levels count : what do wealth-effects tell us in Africa?," MPRA Paper 42180, University Library of Munich, Germany.
  4. Simplice A, Asongu, 2011. "How would population growth affect investment in the future? Asymmetric panel causality evidence for Africa," MPRA Paper 30124, University Library of Munich, Germany.
  5. Asongu Simplice, 2012. "Institutional benchmarking of foreign aid effectiveness in Africa," Working Papers 12/028, African Governance and Development Institute..
  6. Asongu Simplice, 2012. "Development thresholds of foreign aid effectiveness in Africa," Working Papers 12/010, African Governance and Development Institute..
  7. Simplice A, Asongu, 2012. "Financial development dynamic thresholds of financial globalization: evidence from Africa," MPRA Paper 44254, University Library of Munich, Germany.
  8. Simplice A, Asongu, 2012. "Determinants of Health Professionals’ Migration in Africa," MPRA Paper 37632, University Library of Munich, Germany.
  9. Asongu Simplice, 2012. "Globalization, (fighting) corruption and development: how are these phenomena linearly and nonlinearly related in wealth effects?," Working Papers 12/024, African Governance and Development Institute..
  10. Kodila-Tedika, Oasis, 2013. "Forget your gods: African evidence on the relation between state capacity and cognitive ability of leading politicians," MPRA Paper 46449, University Library of Munich, Germany.
  11. Asongu Simplice, 2012. "Are financial benefits of financial globalization questionable until greater domestic financial development has taken place?," Working Papers 12/007, African Governance and Development Institute..

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