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Does Aid Work for the Poor?

  • Mark McGillivray

    ()

    (Alfred Deakin Research Institute, Deakin University)

  • David Fielding

    ()

    (Department of Economics, University of Otago)

  • Sebastian Torres

    (School of African and Oriental Studies, University of London)

  • Stephen Knowles

    ()

    (Department of Economics, University of Otago)

This paper econometrically examines the impact of aid on the well-being of population sub-groups within 48 developing countries. This is a radical departure from previous empirical research of aid effectiveness at the country level, which has looked mainly at the relationship between aid and national aggregates, per capita GDP growth in particular. A specific concern of the paper is the impact of aid on the wealth, education and health of the poorest. Results indicate that while aid improves the wellbeing of the poorest groups, it is the richer groups that benefit the most.

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File URL: http://www.business.otago.ac.nz/econ/research/discussionpapers/DP_1114.pdf
File Function: First version, 2011
Download Restriction: no

Paper provided by University of Otago, Department of Economics in its series Working Papers with number 1114.

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Length: 35 pages
Date of creation: Dec 2011
Date of revision: Dec 2011
Handle: RePEc:otg:wpaper:1114
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Web page: http://www.business.otago.ac.nz/econ
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  1. David Roodman, 2004. "The Anarchy of Numbers: Aid, Development, and Cross-country Empirics," Development and Comp Systems 0412003, EconWPA.
  2. Kanbur Ravi, 2001. "Economic Policy, Distribution and Poverty: The Nature of Disagreements," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 7(2), pages 1-26, April.
  3. Hansen, Henrik & Tarp, Finn, 2000. "Aid and Growth Regressions," MPRA Paper 62288, University Library of Munich, Germany.
  4. Channing, Arndt & Jones, Sam & Tarp, Finn, 2010. "Aid, Growth, and Development Have We Come Full Circle?," Working Paper Series wp2010-96, World Institute for Development Economic Research (UNU-WIDER).
  5. Heller, Peter S, 1975. "A Model of Public Fiscal Behavior in Developing Countries: Aid, Investment, and Taxation," American Economic Review, American Economic Association, vol. 65(3), pages 429-45, June.
  6. Mark McGillivray & Simon Feeny & Niels Hermes & Robert Lensink, 2006. "Controversies over the impact of development aid: it works; it doesn't; it can, but that depends …," Journal of International Development, John Wiley & Sons, Ltd., vol. 18(7), pages 1031-1050.
  7. Pack, Howard & Pack, Janet Rothenberg, 1993. "Foreign Aid and the Question of Fungibility," The Review of Economics and Statistics, MIT Press, vol. 75(2), pages 258-65, May.
  8. Angus Deaton, 2009. "Instruments of development: Randomization in the tropics, and the search for the elusive keys to economic development," Working Papers 1122, Princeton University, Woodrow Wilson School of Public and International Affairs, Research Program in Development Studies..
  9. David Fielding & Sebastian Torres, 2009. "Health, Wealth, Fertility, Education, and Inequality," Review of Development Economics, Wiley Blackwell, vol. 13(1), pages 39-55, 02.
  10. Michael Clemens & Steven Radelet & Rikhil Bhavnani, 2004. "Counting Chickens When They Hatch: The Short-term Effect of Aid on Growth," Working Papers 44, Center for Global Development.
  11. Gang, Ira N. & Ali Khan, Haider, 1990. "Foreign aid, taxes, and public investment," Journal of Development Economics, Elsevier, vol. 34(1-2), pages 355-369, November.
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