An Empirical Analysis of the Determinants of Foreign Aid: A Panel Approach
This paper uses a panel approach to examine the determinants of foreign aid. It examines the extent to which taxes on international trade and the scope of government activities, ethnicity, private credit, and education determine foreign aid. The paper specifies and estimates a model that explains the allocation of foreign aid among 151 countries over the period 1975 to 1998. The key empirical finding suggests that Taxes on Trade increases foreign aid dependency. Moreover, trade, private credit, foreign direct investment, GDP per worker, and government consumption are important determinants of foreign aid. The factors that appear to decrease foreign aid include: Years of schooling, private credit, trade, and GDP per worker. The factors that appear to increase foreign aid include: Taxes on international trade, ethnicity, and government consumption. Copyright Springer Science+Business Media, Inc. 2006
Volume (Year): 12 (2006)
Issue (Month): 2 (May)
|Contact details of provider:|| Postal: Suite 650, International Tower, 229 Peachtree Street, N.E., Atlanta, GA 30303|
Phone: (404) 965-1555
Fax: (404) 965-1556
Web page: http://springerlink.metapress.com/link.asp?id=112112
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Krueger, Anne O, 1974. "The Political Economy of the Rent-Seeking Society," American Economic Review, American Economic Association, vol. 64(3), pages 291-303, June.
- Robert H. Bates, 1999.
"Ethnicity, Capital Formation, and Conflict,"
CID Working Papers
27, Center for International Development at Harvard University.
- Laffont, Jean-Jacques & N'Guessan, Tchetche, 1999. "Competition and corruption in an agency relationship," Journal of Development Economics, Elsevier, vol. 60(2), pages 271-295, December.
- Svensson, J, 1996.
"Collusion Among Interest Groups : Foreign Aid and Rent-Dissipation,"
610, Stockholm - International Economic Studies.
- Svensson, Jakob, 1997. "Collusion Among Interest Grops: Foreign Aid and Rent Dissipation," Seminar Papers 610, Stockholm University, Institute for International Economic Studies.
- William Easterly & Ross Levine, 1997.
"Africa's Growth Tragedy: Policies and Ethnic Divisions,"
The Quarterly Journal of Economics,
Oxford University Press, vol. 112(4), pages 1203-1250.
- Easterly, W & Levine, R, 1996. "Africa's Growth Tragedy : Policies and Ethnic Divisions," Papers 536, Harvard - Institute for International Development.
- North, D.C., 1990.
"A Transaction Cost Theory of Politics,"
144, Washington St. Louis - School of Business and Political Economy.
- Rowley, Charles K., 2000. "Political culture and economic performance in sub-Saharan Africa," European Journal of Political Economy, Elsevier, vol. 16(1), pages 133-158, March.
- Krueger, Anne O, 1993. "Virtuous and Vicious Circles in Economic Development," American Economic Review, American Economic Association, vol. 83(2), pages 351-55, May.
- Krauss, Melvyn, 1997. "How Nations Grow Rich: The Case for Free Trade," OUP Catalogue, Oxford University Press, number 9780195112375, July.
- Cashel-Cordo, Peter & Craig, Steven G, 1997. "Donor Preferences and Recipient Fiscal Behavior: A Simultaneous Analysis of Foreign Aid," Economic Inquiry, Western Economic Association International, vol. 35(3), pages 653-71, July.
- Mohammad, Sharif & Whalley, John, 1984. "Rent Seeking in India: Its Costs and Policy Significance," Kyklos, Wiley Blackwell, vol. 37(3), pages 387-413.
- C. S. Adam & S. A. O'Connell, 1999. "Aid, Taxation and Development in Sub-Saharan Africa," Economics and Politics, Wiley Blackwell, vol. 11(3), pages 225-253, November.
When requesting a correction, please mention this item's handle: RePEc:kap:iaecre:v:12:y:2006:i:2:p:241-250. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla)or (Christopher F. Baum)
If references are entirely missing, you can add them using this form.