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Chinese aid and local political attitudes

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  • Bai, Yu
  • Li, Yanjun
  • Wang, Yunuo

Abstract

This paper investigates whether and how foreign aid generates pro-authority attitudes in recipient regions. With a retrospection to the literature on the soft-power implications of aid, through which donors seek to cultivate specific values, this paper contributes to the investigation of the mechanisms behind the correlation. Combining a geo-referenced dataset on Chinese aid projects obtained from AidData with the political attitudes of residents from four World Value Survey waves across 526 sub-national regions in 47 developing countries, we use a difference-in-difference-in-differences (DDD) type of approach and an instrumental variable (IV) method to address the endogeneity issues. We show that Chinese infrastructure aid significantly motivated a positive attitude toward several organs of government in the regions where the aid was implemented. The main channels of this effect are improved welfare and increased affinity for the values espoused by Chinese donors, occurring through the interaction between residents in the aid-receiving regions and Chinese enterprises and their employees dispatched to these regions.

Suggested Citation

  • Bai, Yu & Li, Yanjun & Wang, Yunuo, 2022. "Chinese aid and local political attitudes," Economic Modelling, Elsevier, vol. 113(C).
    • Handle: RePEc:eee:ecmode:v:113:y:2022:i:c:s0264999322001390
    DOI: 10.1016/j.econmod.2022.105893
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    2. Torsten Müller & Thorsten Schulten, 2022. "Die europäische Mindestlohn-Richtlinie – Paradigmenwechsel hin zu einem Sozialen Europa," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 48(3), pages 335-364.
    3. Zhang, Liyunpeng & Li, Xiao & Zhuang, Yuhang & Li, Ningning, 2022. "World Bank aid and local multidimensional poverty in Sub-Saharan Africa," Economic Modelling, Elsevier, vol. 117(C).
    4. Michael Appiah‐Kubi & Jeneshia Jarrett, 2023. "Chinese aid and crime: Evidence from Africa," Journal of International Development, John Wiley & Sons, Ltd., vol. 35(7), pages 1619-1647, October.
    5. Shen, Guobing & Shen, Binchao & Wu, Ruochen & Yuan, Zhengyu, 2023. "Internetization and the markups of export firms: Evidence from China," Economic Modelling, Elsevier, vol. 120(C).

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    More about this item

    Keywords

    Political attitudes; Beliefs; Chinese aid; Official financial assistance; Soft power; AidData; Developing countries;
    All these keywords.

    JEL classification:

    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General
    • Z10 - Other Special Topics - - Cultural Economics - - - General

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