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Aid, Growth, and Development: Have We Come Full Circle?

Listed author(s):
  • Arndt Channing

    (University of Copenhagen)

  • Jones Sam

    (University of Copenhagen)

  • Tarp Finn

    (University of Copenhagen and UNU-WIDER)

The 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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Article provided by De Gruyter in its journal Journal of Globalization and Development.

Volume (Year): 1 (2010)
Issue (Month): 2 (December)
Pages: 1-29

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Handle: RePEc:bpj:globdv:v:1:y:2010:i:2:n:5
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