Is There Anything Wrong with Tied-Aid?
The paper examines the effects of tied-aid on the welfare of both the donor and the recipient countries. We depart from the previous literature by assuming pre-existence of quantitative trade distortions. To migrate these distortions the donor dountry provides aid that is tied to the rationed good. In this framework we show that the important factors that determine the welfare effects are the price elasticity of the donor's net supply of the export good, the degree of tiedness of the aid, and the quota rent retention parameter. Conditions for the presence of the transfer paradox are derived and interpreted under stability conditions. Furthermore, conditions where both countries gain from tied-aid are derived.
To our knowledge, this item is not available for
download. To find whether it is available, there are three
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
|Date of creation:|
|Contact details of provider:|| Postal: Øster Farimagsgade 5, Building 26, DK-1353 Copenhagen K., Denmark|
Phone: (+45) 3532 4411
Fax: +45 35 32 30 00
Web page: http://www.econ.ku.dk/epru/
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:kud:epruwp:94-05. 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: (Thomas Hoffmann)
If references are entirely missing, you can add them using this form.