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Does foreign aid distort incentives and hurt growth? Theory and evidence from 75 aid-recipient countries

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  • George Economides

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  • Sarantis Kalyvitis
  • Apostolis Philippopoulos

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  • George Economides & Sarantis Kalyvitis & Apostolis Philippopoulos, 2008. "Does foreign aid distort incentives and hurt growth? Theory and evidence from 75 aid-recipient countries," Public Choice, Springer, vol. 134(3), pages 463-488, March.
  • Handle: RePEc:kap:pubcho:v:134:y:2008:i:3:p:463-488 DOI: 10.1007/s11127-007-9239-9
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    11. Carl-Johan Dalgaard & Henrik Hansen & Finn Tarp, 2004. "On The Empirics of Foreign Aid and Growth," Economic Journal, Royal Economic Society, vol. 114(496), pages 191-216, June.
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    13. John R. Conlon & Paul Pecorino, 2004. "Policy Reform and the Free-Rider Problem," Public Choice, Springer, vol. 120(1_2), pages 123-142, July.
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    16. Fredriksson, Per G. & Svensson, Jakob, 2003. "Political instability, corruption and policy formation: the case of environmental policy," Journal of Public Economics, Elsevier, vol. 87(7-8), pages 1383-1405, August.
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    Citations

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    Cited by:

    1. Dierk Herzer & Michael Grimm, 2012. "Does foreign aid increase private investment? Evidence from panel cointegration," Applied Economics, Taylor & Francis Journals, vol. 44(20), pages 2537-2550, July.
    2. Julian Donaubauer, 2014. "Does foreign aid really attract foreign investors? New evidence from panel cointegration," Applied Economics Letters, Taylor & Francis Journals, vol. 21(15), pages 1094-1098, October.
    3. Christian Leßmann & Gunther Markwardt, 2010. "Decentralization and Foreign Aid Effectiveness: Do Aid Modality and Federal Design Matter in Poverty Alleviation?," CESifo Working Paper Series 3035, CESifo Group Munich.
    4. Vasilakis, Chrysovalantis, 2017. "Fighting Poverty And Child Malnutrition: On The Design Of Foreign Aid Policies," Macroeconomic Dynamics, Cambridge University Press, pages 1935-1956.
    5. Donaubauer, Julian & Meyer, Birgit & Nunnenkamp, Peter, 2016. "Aid, Infrastructure, and FDI: Assessing the Transmission Channel with a New Index of Infrastructure," World Development, Elsevier, vol. 78(C), pages 230-245.
    6. Uchenna EFOBI & Simplice ASONGU & Ibukun BEECROFT, 2015. "Foreign Direct Investment, Aid and Terrorism: Empirical Insight Conditioned on Corruption Control," Working Papers 15/007, African Governance and Development Institute..
    7. Chen, Hong & Singh, Baljeet, 2016. "Official Development Assistance, Public Investment and Economic Growth in Asia and the Pacific," International Journal of Development and Conflict, Gokhale Institute of Politics and Economics, vol. 6(2), pages 73-96.
    8. David Zetland, 2010. "Save the poor, shoot some bankers," Public Choice, Springer, vol. 145(3), pages 331-337, December.
    9. Lessmann, Christian & Markwardt, Gunther, 2012. "Aid, Growth and Devolution," World Development, Elsevier, vol. 40(9), pages 1723-1749.
    10. Uchenna EFOBI & Ibukun BEECROFT & Simplice ASONGU, 2014. "Foreign Aid and Corruption: Clarifying Murky Empirical Conclusions," Working Papers 14/025, African Governance and Development Institute..
    11. Dierk Herzer & Oliver Morrissey, "undated". "The Long-Run Effect of Aid on Domestic Output," Discussion Papers 09/01, University of Nottingham, CREDIT.
    12. Donaubauer, Julian & Herzer, Dierk & Nunnenkamp, Peter, 2012. "Does aid for education attract foreign investors? An empirical analysis for Latin America," Kiel Working Papers 1806, Kiel Institute for the World Economy (IfW).
    13. Lessmann, Christian & Markwardt, Gunther, 2010. "Fiscal federalism and foreign transfers: does inter-jurisdictional competition increase foreign aid effectiveness?," Dresden Discussion Paper Series in Economics 10/10, Technische Universität Dresden, Faculty of Business and Economics, Department of Economics.
    14. Hodler, Roland & Dreher, Axel, 2013. "Development (paradigm) failures," Journal of Development Economics, Elsevier, vol. 101(C), pages 63-74.
    15. Charalampos Savvidis, 2011. "International positive production externalities under a transfer payment scheme – the case for cooperation," SPOUDAI Journal of Economics and Business, SPOUDAI Journal of Economics and Business, University of Piraeus, vol. 61(1-2), pages 80-117, June - Ja.
    16. Herzer, Dierk & Nunnenkamp, Peter, 2012. "The effect of foreign aid on income inequality: Evidence from panel cointegration," Structural Change and Economic Dynamics, Elsevier, vol. 23(3), pages 245-255.
    17. David Cuberes & Kevin Tsui, 2011. "Aid and Fertility: What Does the Cross-Country Evidence Show?," Working Papers 2011024, The University of Sheffield, Department of Economics.
    18. Lessmann, Christian & Markwardt, Gunther, 2009. "Aid, growth and decentralization," Dresden Discussion Paper Series in Economics 09/09, Technische Universität Dresden, Faculty of Business and Economics, Department of Economics.
    19. Neanidis, Kyriakos C. & Varvarigos, Dimitrios, 2009. "The allocation of volatile aid and economic growth: Theory and evidence," European Journal of Political Economy, Elsevier, vol. 25(4), pages 447-462, December.

    More about this item

    Keywords

    Foreign aid; Incentives; Growth; F35; D7; D9; H2;

    JEL classification:

    • F35 - International Economics - - International Finance - - - Foreign Aid
    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • D9 - Microeconomics - - Micro-Based Behavioral Economics
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue

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