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Entwicklungshilfe und ökonomische Freiheit: Besteht ein Zusammenhang?

Listed author(s):
  • Tobias Knedlik
  • Franz Kronthaler

Development aid attracts currently high public attention, e.g. because of the Millennium Development Goals of the United Nations. Thereby so-called weak factors gain importance in the debate of development policy. In this regard the establishing of enabling conditions, which allow and support economic activities is central. Economic freedom is an important concept in the discussion. The academic literature clearly suggests a positive relation between economic freedom and economic development. This is the motivation to analyze the impact of development aid on economic freedom. This contribution analysis this impact of two forms of development aid (conditional and overall aid). In contrast to expectations the results show a positive impact of overall aid and a negative impact of conditional aid on economic freedom. Economic policy should consider the positive effect of overall aid and adjust aid conditions according to domestic requirements in recipient countries to avoid negative effects on economic freedom.

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Article provided by Halle Institute for Economic Research in its journal Wirtschaft im Wandel.

Volume (Year): 12 (2006)
Issue (Month): 11 ()
Pages: 338-344

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Handle: RePEc:iwh:iwhwiw:11-06-6
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