Aid, Growth, and Development Have We Come Full Circle?
AbstractThe micro-macro paradox has been revived. Despite broadly positive evaluations at the micro and meso-levels, recent literature doubts the ability of foreign aid to foster economic growth and development. This paper assesses the aid-growth literature and, taking inspiration from the program evaluation literature, we re-examine key hypotheses. In our findings, aid has a positive and statistically significant causal effect on growth over the long run, with confidence intervals conforming to levels suggested by growth theory. Aid remains a key tool for enhancing the development prospects of poor countries.
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Bibliographic InfoPaper provided by World Institute for Development Economic Research (UNU-WIDER) in its series Working Paper Series with number wp2010-96.
Length: 38 pages
Date of creation: 2010
Date of revision:
Foreign aid; growth; aid effectiveness; causal effects;
Other versions of this item:
- Arndt Channing & Jones Sam & Tarp Finn, 2010. "Aid, Growth, and Development: Have We Come Full Circle?," Journal of Globalization and Development, De Gruyter, vol. 1(2), pages 1-29, December.
- O1 - Economic Development, Technological Change, and Growth - - Economic Development
- O4 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
- F35 - International Economics - - International Finance - - - Foreign Aid
- C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-10-23 (All new papers)
- NEP-CWA-2010-10-23 (Central & Western Asia)
- NEP-DEV-2010-10-23 (Development)
- NEP-FDG-2010-10-23 (Financial Development & Growth)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Enrique Moral-Benito, 2012.
"Determinants of Economic Growth: A Bayesian Panel Data Approach,"
The Review of Economics and Statistics,
MIT Press, vol. 94(2), pages 566-579, May.
- Moral-Benito, Enrique, 2009. "Determinants of Economic Growth: A Bayesian Panel Data Approach," Policy Research Working Paper Series 4830, The World Bank.
- Enrique Moral-Benito, 2010. "Determinants of economic growth: A Bayesian panel data approach," Banco de Espaï¿½a Working Papers 1031, Banco de Espa�a.
- Enrique Moral-Benito, 2007. "Determinants Of Economic Growth: A Bayesian Panel Data Approach," Working Papers wp2007_0719, CEMFI.
- Berthelemy, Jean-Claude & Tichit, Ariane, 2004.
"Bilateral donors' aid allocation decisions--a three-dimensional panel analysis,"
International Review of Economics & Finance,
Elsevier, vol. 13(3), pages 253-274.
- Berthelemy, Jean-Claude & Tichit, Ariane, 2002. "Bilateral Donors' Aid Allocation Decisions: A Three-dimensional Panel Analysis," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:
- Increasing aid, wasting money?
by Terence Wood in Development Policy Blog on 2011-07-19 19:50:06
- Should aid focus on economic development? (part 2)
by Terence Wood in Development Policy Blog on 2011-05-25 06:11:26
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