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Humanitarian Aid, Fertility and Economic Growth

  • KYRIAKOS C. NEANIDIS

This paper examines the e¤ect of humanitarian aid on the rates of fertility and economic growth in recipient countries. We develop a two-period overlapping generations model where reproductive agents face a non-zero probability of death in childhood. As adults, agents allocate their time to work, leisure, and child rearing activities of surviving children. Health status in adulthood exhibits “state dependence”as it depends on health in childhood. Humanitarian aid in‡uences the probability of survival to adulthood, health in childhood, and the time adults allocate to child rearing, giving rise to an ambiguous e¤ect on both the rates of fertility and growth. An empirical examination for the period 1973-2007 suggests that humanitarian aid has on average a zero e¤ect on both the fertility rate and the rate of per capita output growth. The …ndings are robust to a wide number of sensitivity considerations.

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Article provided by London School of Economics and Political Science in its journal Economica.

Volume (Year): 79 (2012)
Issue (Month): 313 (01)
Pages: 27-61

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Handle: RePEc:bla:econom:v:79:y:2012:i:313:p:27-61
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  1. Luis Angeles & Kyriakos C Neanidis, 2006. "Aid Effectiveness: The Role of the Local Elite," Working Papers 2007_01, Business School - Economics, University of Glasgow, revised Dec 2006.
  2. Grossman, Michael, 1972. "On the Concept of Health Capital and the Demand for Health," Journal of Political Economy, University of Chicago Press, vol. 80(2), pages 223-55, March-Apr.
  3. Minoiu, Camelia & Reddy, Sanjay G., 2010. "Development aid and economic growth: A positive long-run relation," The Quarterly Review of Economics and Finance, Elsevier, vol. 50(1), pages 27-39, February.
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  5. Josepa Miquel-Florensa, 2007. "Aid Effectiveness: A comparison of Tied and Untied Aid," Working Papers 2007_3, York University, Department of Economics.
  6. Nattavudh Powdthavee & Anna Vignoles, 2008. "Mental Health of Parents and Life Satisfaction of Children: A Within-Family Analysis of Intergenerational Transmission of Well-Being," Social Indicators Research, Springer, vol. 88(3), pages 397-422, September.
  7. Richard Blundell & Steve Bond, 1995. "Initial conditions and moment restrictions in dynamic panel data models," IFS Working Papers W95/17, Institute for Fiscal Studies.
  8. Angeles, Luis, 2008. "Demographic Transitions: analyzing the effects of mortality on fertility," SIRE Discussion Papers 2008-33, Scottish Institute for Research in Economics (SIRE).
  9. Hristos Doucouliagos & Martin Paldam, 2005. "Aid Effectiveness on Growth. A Meta Study," Economics Working Papers 2005-13, School of Economics and Management, University of Aarhus.
  10. Leonid Azarnert, 2006. "Child mortality, fertility, and human capital accumulation," Journal of Population Economics, Springer, vol. 19(2), pages 285-297, June.
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  12. Bhattacharya, Joydeep & Qiao, Xue, 2005. "Public and Private Expenditures on Health in a Growth Model," Staff General Research Papers 12378, Iowa State University, Department of Economics.
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