IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/36545.html
   My bibliography  Save this paper

On the effect of foreign aid on corruption

Author

Listed:
  • Simplice A, Asongu

Abstract

The Okada & Samreth(2012, EL) finding that aid deters corruption could have an important influence on policy and academic debates. This paper partially negates their criticism of the mainstream approach to the aid-development nexus. Using updated data(1996-2010) from 52 African countries we provide robust evidence of a positive aid-corruption nexus. Development assistance fuels(mitigates) corruption(the control of corruption) in the African continent. As a policy implication, the Okada & Samreth(2012, EL) finding for developing countries may not be relevant for Africa.

Suggested Citation

  • Simplice A, Asongu, 2012. "On the effect of foreign aid on corruption," MPRA Paper 36545, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:36545
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/36545/1/MPRA_paper_36545.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. La Porta, Rafael & Florencio Lopez-de-Silanes & Andrei Shleifer & Robert W. Vishny, 1997. "Legal Determinants of External Finance," Journal of Finance, American Finance Association, vol. 52(3), pages 1131-1150, July.
    2. Okada, Keisuke & Samreth, Sovannroeun, 2012. "The effect of foreign aid on corruption: A quantile regression approach," Economics Letters, Elsevier, vol. 115(2), pages 240-243.
    3. Billger, Sherrilyn M. & Goel, Rajeev K., 2009. "Do existing corruption levels matter in controlling corruption?: Cross-country quantile regression estimates," Journal of Development Economics, Elsevier, vol. 90(2), pages 299-305, November.
    4. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    5. Shleifer, Andrei & La Porta, Rafael & Lopez-De-Silanes, Florencio & Vishny, Robert W., 1997. "Legal Determinants of External Finance," Scholarly Articles 30728041, Harvard University Department of Economics.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Schneider, Sophie Therese, 2018. "North-South trade agreements and the quality of institutions: Panel data evidence," Hohenheim Discussion Papers in Business, Economics and Social Sciences 27-2018, University of Hohenheim, Faculty of Business, Economics and Social Sciences.
    2. Oasis Kodila-Tedika & Simplice A. Asongu, 2022. "Tribalism and Finance," Journal of Interdisciplinary Economics, , vol. 34(2), pages 162-176, July.
    3. Ongo Nkoa, Bruno Emmanuel & Song, Jacques Simon, 2020. "Does institutional quality affect financial inclusion in Africa? A panel data analysis," Economic Systems, Elsevier, vol. 44(4).
    4. Alam, Ashraful & Uddin, Moshfique & Yazdifar, Hassan & Shafique, Sujana & Lartey, Theophilus, 2020. "R&D investment, firm performance and moderating role of system and safeguard: Evidence from emerging markets," Journal of Business Research, Elsevier, vol. 106(C), pages 94-105.
    5. Simplice Asongu, 2014. "The Questionable Economics of Development Assistance in Africa: Hot-Fresh Evidence, 1996–2010," The Review of Black Political Economy, Springer;National Economic Association, vol. 41(4), pages 455-480, December.
    6. Adam Levai & Riccardo Turati, 2021. "The Impact of Immigration on Workers’ Protection," LIDAM Discussion Papers IRES 2021021, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES), revised 07 Sep 2021.
    7. Doan, Anh-Tuan & Lin, Kun-Li & Doong, Shuh-Chyi, 2020. "State-controlled banks and income smoothing. Do politics matter?," The North American Journal of Economics and Finance, Elsevier, vol. 51(C).
    8. Beck, Thorsten & Levine, Ross & Loayza, Norman, 2000. "Finance and the sources of growth," Journal of Financial Economics, Elsevier, vol. 58(1-2), pages 261-300.
    9. Jean-Pierre Allegret & Sana Azzabi, 2014. "Intégration financière internationale et croissance économique dans les pays émergents et en développement : le canal du développement financier," Revue d’économie du développement, De Boeck Université, vol. 22(3), pages 27-68.
    10. Lakshmi, Geeta & Saha, Shrabani & Bhattarai, Keshab, 2021. "Does corruption matter for stock markets? The role of heterogeneous institutions," Economic Modelling, Elsevier, vol. 94(C), pages 386-400.
    11. Nigel Driffield & Sarmistha Pal, 2010. "Evolution of capital structure in east Asia—corporate inertia or endeavours?," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 173(1), pages 1-29, January.
    12. Enrico C. Perotti & Luc Laeven & Pieter van Oijen, 2000. "Confidence Building in Emerging Stock Markets," William Davidson Institute Working Papers Series 366, William Davidson Institute at the University of Michigan.
    13. Asongu, Simplice A., 2017. "The effect of reducing information asymmetry on loan price and quantity in the African banking industry," Research in International Business and Finance, Elsevier, vol. 41(C), pages 185-197.
    14. Andrea F Presbitero, 2012. "Total Public Debt and Growth in Developing Countries," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 24(4), pages 606-626, September.
    15. Ross Levine & Norman Loayza & Thorsten Beck, 2002. "Financial Intermediation and Growth: Causality and Causes," Central Banking, Analysis, and Economic Policies Book Series, in: Leonardo Hernández & Klaus Schmidt-Hebbel & Norman Loayza (Series Editor) & Klaus Schmidt-Hebbel (Se (ed.),Banking, Financial Integration, and International Crises, edition 1, volume 3, chapter 2, pages 031-084, Central Bank of Chile.
    16. Le Trung Thanh, 2017. "Corruption, Provincial Institutions And Capital Structure: New Evidence From A Transitional Economy," Organizations and Markets in Emerging Economies, Faculty of Economics, Vilnius University, vol. 8(1).
    17. Mauricio Jara‐Bertin & Félix J. López‐Iturriaga & Óscar López‐de‐Foronda, 2008. "The Contest to the Control in European Family Firms: How Other Shareholders Affect Firm Value," Corporate Governance: An International Review, Wiley Blackwell, vol. 16(3), pages 146-159, May.
    18. Asongu, Simplice A. & Amankwah-Amoah, Joseph, 2018. "Mitigating capital flight through military expenditure: Insight from 37 African countries," Research in International Business and Finance, Elsevier, vol. 45(C), pages 38-53.
    19. Kodila-Tedika, Oasis & Asongu, Simplice, 2015. "Tribalism and Financial Development," MPRA Paper 67855, University Library of Munich, Germany.
    20. Simplice A. Asongu & Nicholas M. Odhiambo, 2020. "Remittances, the diffusion of information and industrialisation in Africa," Contemporary Social Science, Taylor & Francis Journals, vol. 15(1), pages 98-117, January.

    More about this item

    Keywords

    Foreign Aid; Political Economy; Development; Africa;
    All these keywords.

    JEL classification:

    • F35 - International Economics - - International Finance - - - Foreign Aid
    • F50 - International Economics - - International Relations, National Security, and International Political Economy - - - General
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • B20 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:36545. 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: . General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.