Determinants of the Allocation of US Aid forTrade
Since the 2001 Doha Round of multilateral trade negotiations, members of the World Trade Organization (WTO) have shown a renewed interest in using a new type of aid known as aid for trade (hereafter to be simply referred as AFT) as a means for catapulting the economic growth performance of developing countries. Japan, U.S., and the United Kingdom account for a significant proportion of AFT outlays being extended to developing countries. Despite the rise in the amount of funding outlays, to date, there is little information as to what determines the allocation of the AFT funds to different countries and the impact of the aid on the economic performance of the recipient developing economies. Using data on U.S. AFT outlays extended to a panel of 54 developing countries during 1999-2005, this study identifies some salient donor and recipient specific factors that influence the propensity and intensity of AFT allocation. Our study indicates that the share of AFT given to a country is greater: the larger is the relative magnitude of the donor’s exports to the recipient country, the more vulnerable the recipient country is to external economic shocks, the more politically globalized and landlocked the recipient is, the lower the level of economic freedom enjoyed by the citizens of the recipient country, and the higher the amount of the traditional Non-AFT aid per capita inflow is to the country. On the other hand, both the propensity and intensity of U.S. AFT falls with a rise in the recipient country’s ability to serve as a source for U.S. import supply and the more integrated it is with the rest of the world.
|Date of creation:||Jan 2009|
|Contact details of provider:|| Web page: http://www.mtsu.edu/~berc/working/Economics_Working_Papers.html|
More information through EDIRC
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.:
- James A. Dunlevy, 2006. "The Influence of Corruption and Language on the Protrade Effect of Immigrants: Evidence from the American States," The Review of Economics and Statistics, MIT Press, vol. 88(1), pages 182-186, February.
- Subhayu Bandyopadhyay & Howard J. Wall, 2007.
"The determinants of aid in the post-cold war era,"
Federal Reserve Bank of St. Louis, issue Nov, pages 533-548.
- Subhayu Bandyopadhyay, 2006. "The Determinants of Aid in the Post-Cold War Era," Working Papers 06-14 Classification- JEL, Department of Economics, West Virginia University.
- Subhayu Bandyopadhyay & Howard J. Wall, 2006. "The determinants of aid in the post-cold war era," Working Papers 2006-021, Federal Reserve Bank of St. Louis.
- Wagner, Don, 2003. "Aid and trade--an empirical study," Journal of the Japanese and International Economies, Elsevier, vol. 17(2), pages 153-173, June.
- Berthelemy, Jean-Claude & Tichit, Ariane, 2004. "Bilateral donors' aid allocation decisions--a three-dimensional panel analysis," International Review of Economics & Finance, Elsevier, vol. 13(3), pages 253-274.
- Berthelemy, Jean-Claude & Tichit, Ariane, 2002. "Bilateral Donors' Aid Allocation Decisions: A Three-dimensional Panel Analysis," WIDER Working Paper Series 123, World Institute for Development Economic Research (UNU-WIDER).
- Robert C. Feenstra & James R. Markusen & Andrew K. Rose, 2001. "Using the gravity equation to differentiate among alternative theories of trade," Canadian Journal of Economics, Canadian Economics Association, vol. 34(2), pages 430-447, May.
- Wagner, Don & Head, Keith & Ries, John, 2002. "Immigration and the Trade of Provinces," Scottish Journal of Political Economy, Scottish Economic Society, vol. 49(5), pages 507-525, December.
- 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, 06.
- Carl-Johan Dalgaard & Henrik Hansen & Finn Tarp, 2001. "On the Empirics of Foreign Aid and Growth," EPRU Working Paper Series 03-13, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics, revised Sep 2003.
- Dalgaard, Carl-Johan & Hansen, Henrik & Tarp, Finn, 2002. "On the Empirics of Foreign Aid and Growth," MPRA Paper 63696, University Library of Munich, Germany.
- Raghuram G. Rajan & Arvind Subramanian, 2008. "Aid and Growth: What Does the Cross-Country Evidence Really Show?," The Review of Economics and Statistics, MIT Press, vol. 90(4), pages 643-665, November.
- Raghuram Rajan & Arvind Subramanian, 2005. "Aid and Growth; What Does the Cross-Country Evidence Really Show?," IMF Working Papers 05/127, International Monetary Fund.
- Raghuram G. Rajan, 2005. "Aid and Growth: What Does The Cross-Country Evidence Really Show?," Working Papers id:54, eSocialSciences.
- Raghuram G. Rajan & Arvind Subramanian, 2005. "Aid and Growth: What Does the Cross-Country Evidence Really Show?," NBER Working Papers 11513, National Bureau of Economic Research, Inc.
- Easterly, William, 2006. "Planners versus Searchers in Foreign Aid," Asian Development Review, Asian Development Bank, vol. 23(2), pages 1-35.
- Hutchinson, William K, 2002. "Does Ease of Communication Increase Trade? Commonality of Language and Bilateral Trade," Scottish Journal of Political Economy, Scottish Economic Society, vol. 49(5), pages 544-556, December.
- Jonathan Munemo & Subhayu Bandyopadhyay & Arabinda Basistha, 2006. "Foreign Aid and Export Performance: A Panel Data Analysis of Developing Countries," Working Papers 06-10 Classification-, Department of Economics, West Virginia University.
- Jonathan Munemo & Subhayu Bandyopadhyay & Arabinda Basisth, 2007. "Foreign aid and export performance: a panel data analysis of developing countries," Working Papers 2007-023, Federal Reserve Bank of St. Louis.
- Bora, Saswati & Bouet, Antoine & Roy, Devesh, 2007. "The marginalization of Africa in world trade:," Research briefs 7, International Food Policy Research Institute (IFPRI).
- Alan Deardorff, 1998. "Determinants of Bilateral Trade: Does Gravity Work in a Neoclassical World?," NBER Chapters,in: The Regionalization of the World Economy, pages 7-32 National Bureau of Economic Research, Inc.
- Deardorff, A.V., 1995. "Determinants of Bilateral Trade : Does Gravity Work in a Neoclassical World?," Papers 95-05, Michigan - Center for Research on Economic & Social Theory.
- Alan V. Deardorff, 1995. "Determinants of Bilateral Trade: Does Gravity Work in a Neoclassical World?," NBER Working Papers 5377, National Bureau of Economic Research, Inc.
When requesting a correction, please mention this item's handle: RePEc:mts:wpaper:200901. 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: (E. Anthon Eff)
If references are entirely missing, you can add them using this form.