Development Aid, Corruption, and the Happiness of Nations: Analysis of 118 countries over the years 1996-2009
Several studies emphasize the importance of the general environment in recipient countries for effectiveness of development aid. Another more recent strand of the literature considers whether the receipt of aid affects the happiness of developing countries. Since corruption, an indicator of the general environment, coexists with aid we consider an empirical model where both are arguments of a happiness production function. We present evidence on the relationship between happiness and aid given different levels of corruption. We find that accounting for corruption, aid has a negative marginal effect on happiness – but only in countries where corruption is most rampant.
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Volume (Year): 12 (2012)
Issue (Month): 2 ()
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References listed on IDEAS
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- B. Mak Arvin & Byron Lew, 2010. "Aid and happiness: untangling the causal relationship in nine European donor countries," Global Business and Economics Review, Inderscience Enterprises Ltd, vol. 12(4), pages 341-358.
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- B. Arvin & Byron Lew, 2009. "Happiness and Foreign Aid," Atlantic Economic Journal, International Atlantic Economic Society, vol. 37(3), pages 325-326, September.
- J. Svensson, 1999. "Aid, Growth and Democracy," Economics and Politics, Wiley Blackwell, vol. 11(3), pages 275-297, November.
- Bruno S. Frey, 2008. "Happiness: A Revolution in Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262062771, June.
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