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Does terror increase aid?

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  • Axel Dreher
  • Andreas Fuchs

Abstract

This article empirically investigates whether, and in which ways, donors in the Development Assistance Committee respond to transnational terrorist incidents and the onset of the War on Terror through changes in aid effort and aid allocation. First, an analysis of 22 donor countries shows that aid effort increased during the War on Terror period, but did not respond to the actual number of terror events. Second, using aid allocation equations, we find that countries where terror originates are not more likely to receive aid as a consequence, but if they are selected, they receive larger amounts of aid.
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Suggested Citation

  • Axel Dreher & Andreas Fuchs, 2011. "Does terror increase aid?," Public Choice, Springer, vol. 149(3), pages 337-363, December.
    • Handle: RePEc:kap:pubcho:v:149:y:2011:i:3:p:337-363
    DOI: 10.1007/s11127-011-9878-8
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    More about this item

    Keywords

    Foreign aid; Transnational terrorism; War on Terror and aid; DAC donors; Heckman selection model; F35;
    All these keywords.

    JEL classification:

    • F35 - International Economics - - International Finance - - - Foreign Aid

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