The paper explores the relationships between economic freedom on the one side and development aid and IMF credit as approximation for conditional aid on the other side. After a short review of current literature the paper develops a simple panel regression model to evaluate the relationships. In contrast to previous research, our results allow the rejection of the hypothesis that IMF credit increases economic freedom and that development aid is not contributing to economic freedom. It could not be shown that countries can be forced to economic freedom by aid conditions. The paper discusses explanations of the empirical findings. --
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Find related papers by JEL classification: P10 - Economic Systems - - Capitalist Systems - - - General F35 - International Economics - - International Finance - - - Foreign Aid O19 - Economic Development, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
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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.:
Simeon Djankov & Jose Montalvo & Marta Reynal-Querol, 2008.
"The curse of aid,"
Journal of Economic Growth,
Springer, vol. 13(3), pages 169-194, September.
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Simeon Djankov & José Garcia Montalvo & Marta Reynal-Querol, 2005.
"The Curse of Aid,"
Economics Working Papers
870, Department of Economics and Business, Universitat Pompeu Fabra.
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