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Aid, policy, and growth in post-conflict societies

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Author Info
Collier, Paul
Hoeffler, Anke

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Abstract

Countries emerging from civil war attract both aid and policy advice. This paper provides the first systematic empirical analysis of aid and policy reform in the post-conflict growth process. It is based on a comprehensive data set of large civil wars and covers 27 countries that were in their first decade of post-conflict economic recovery during the 1990s. The authors first investigate whether the absorptive capacity for aid is systematically different in post-conflict countries. They find that during the first three post-conflict years, absorptive capacity is no greater than normal, but that in the rest of the first decade it is approximately double its normal level. So ideally, aid should phase in during the decade. Historically, aid has not, on average, been higher in post-conflict societies, and it has tended to taper out over the course of the decade. The authors then investigate whether the contribution of policy to growth is systematically different in post-conflict countries, and in particular, whether particular components of policy are differentially important. For this they use the World Bank policy rating database. The authors find that growth ismore sensitive to policy in post-conflict societies. Comparing the efficacy of different policies, they find that social policies are differentially important relative to macroeconomic policies. However, historically, this does not appear to have been how policy reform has been prioritized in post-conflict societies.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 2902.

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Date of creation: 31 Oct 2002
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Handle: RePEc:wbk:wbrwps:2902

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Related research
Keywords: Peace&Peacekeeping Services&Transfers to Poor Post Conflict Reconstruction Public Health Promotion Gender and Development Social Conflict and Violence Peace&Peacekeeping Post Conflict Reconstruction Services&Transfers to Poor Rural Poverty Reduction

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References listed on IDEAS
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.:
  1. Paul Collier & Anke Hoeffler, 2002. "Aid, Policy And Peace: Reducing The Risks Of Civil Conflict," Defence and Peace Economics, Taylor and Francis Journals, vol. 13(6), pages 435-450, January. [Downloadable!] (restricted)
  2. Collier, Paul & Dollar, David, 2002. "Aid allocation and poverty reduction," European Economic Review, Elsevier, vol. 46(8), pages 1475-1500, September. [Downloadable!] (restricted)
    Other versions:
  3. 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. [Downloadable!] (restricted)
    Other versions:
  4. Burnside, Craig & Dollar, David, 1997. "Aid, policies, and growth," Policy Research Working Paper Series 1777, The World Bank. [Downloadable!]
    Other versions:
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Cited by:
(explanations, 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.)

  1. Jonathan Beynon, 2003. "Poverty Efficient Aid Allocations - Collier/Dollar Revisited," Working Papers 2, Economics and Statistics Analysis Unit (ESAU), Overseas Development Institute. [Downloadable!]
  2. Axel Dreher & Florian Mölders & Peter Nunnenkamp, 2007. "Are NGOs the Better Donors? A Case Study of Aid Allocation for Sweden," Working papers 07-180, KOF Swiss Economic Institute, ETH Zurich. [Downloadable!]
    Other versions:
  3. Siyan Chen & Norman V. Loayza & Marta Reynal-Querol, 2007. "The Aftermath of Civil War," Economics Working Papers 1043, Department of Economics and Business, Universitat Pompeu Fabra. [Downloadable!]
    Other versions:
  4. Ralf Hepp, 2005. "Can Debt Relief Buy Growth?," International Finance 0510003, EconWPA. [Downloadable!]
  5. Astri Suhrke & Espen Villanger & Susan L. Woodward, 2005. "Economic Aid to Post-conflict Countries: A Methodological Critique of Collier and Hoeffler," CMI Working Papers WP 2005:4, CMI (Chr. Michelsen Institute), Bergen, Norway. [Downloadable!]
  6. Olga Shemyakina, 2006. "The Effect of Armed Conflict on Accumulation of Schooling: Results from Tajikistan," HiCN Working Papers 12, Households in Conflict Network. [Downloadable!]
  7. Alessandro Missale & Silvia Marchesi, 2004. "What does motivate lending and aid to the HIPCs?," International Finance 0411006, EconWPA. [Downloadable!]
  8. Silvia Marchesi & Alessandro Missale, 2007. "How defensive were lending and aid to HIPC?," Working Papers 115, University of Milano-Bicocca, Department of Economics, revised 2007. [Downloadable!]
  9. Ralf Hepp, 2005. "Health Expenditures Under the HIPC Debt Initiative," International Finance 0510005, EconWPA. [Downloadable!]
  10. Paul Collier & Anke Hoeffler, 2002. "Aid, Policy And Peace: Reducing The Risks Of Civil Conflict," Defence and Peace Economics, Taylor and Francis Journals, vol. 13(6), pages 435-450, January. [Downloadable!] (restricted)
  11. Derek D. Headey & D.S. Prasada Rao & Alan Duhs, 2004. "All the Conditions of Effective Foreign Aid," CEPA Working Papers Series WP082004, School of Economics, University of Queensland, Australia. [Downloadable!]
    Other versions:
  12. Michael A. Clemens & Steven Radelet & Rikhil Bhavnani, 2004. "Counting chickens when they hatch: The short-term effect of aid on growth," International Finance 0407010, EconWPA. [Downloadable!]
    Other versions:
  13. K C Neanidis & D Varvarigos, 2005. "The Impact of Foreign Aid on Economic Growth: Volatility of Disbursements and Distribution of Receipts," Centre for Growth and Business Cycle Research Discussion Paper Series 56, Economics, The Univeristy of Manchester. [Downloadable!]
  14. John Roberts, 2004. "Recovery from Economic Collapse: Insight from Input-Output Models and the Special Case of a Collapsed Oil Producer," Working Papers 6, Economics and Statistics Analysis Unit (ESAU), Overseas Development Institute. [Downloadable!]
  15. Kilby, Christopher, . "The Political Economy of Conditionality: An Empirical Analysis of World Bank Enforcement," Vassar College Department of Economics Working Paper Series 92, Vassar College Department of Economics. [Downloadable!]
  16. Kyriakos C. Neanidis & Dimitrios Varvarigos, 2007. "The Allocation of volatile aid and economic growth: Evidence and a suggestive theory," Discussion Paper Series 2007_07, Department of Economics, Loughborough University, revised Mar 2007. [Downloadable!]
  17. Derek Headey, 2005. "Foreign Aid and Foreign Policy: How donors undermine the effectiveness of overseas development assistance," CEPA Working Papers Series WP052005, School of Economics, University of Queensland, Australia. [Downloadable!]
  18. Martha Starr, 2006. "Growth and conflict in the developing world: Neo-liberal narratives and social-economy alternatives," Review of Social Economy, Taylor and Francis Journals, vol. 64(2), pages 205-224, June. [Downloadable!] (restricted)
  19. KIMURA Hidemi & SAWADA Yasuyuki & MORI Yuko, 2007. "Aid Proliferation and Economic Growth: A Cross-Country Analysis," Discussion papers 07044, Research Institute of Economy, Trade and Industry (RIETI). [Downloadable!]
  20. David Roodman, 2004. "The Anarchy of Numbers: Aid, Development, and Cross-country Empirics," Development and Comp Systems 0412003, EconWPA. [Downloadable!]
  21. Johan Moyersoen, 2007. "Psychology's Prospect Theory: Relevance for Identifying Positions of Local Satiation as Robust Reference Points of Joint Actions in Peace Agreements," Peace Economics, Peace Science and Public Policy, Berkeley Electronic Press, vol. 10(1), pages 2. [Downloadable!]
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