We use an excludable instrument to test the effect of bilateral foreign aid on economic growth in a sample of 96 recipient countries over the 1974-2009 period. We interact donor government fractionalization with a recipient country's probability of receiving aid. The results show that...

The diversion of development aid to the recipient's military may be one explanation why aid is often found to be ineffective in promoting economic growth and development. Previous studies have not derived the causal effects of development aid on military expenditure. Using a new instrumental...

Performance-based aid has been proposed as an alternative to the failed traditional approach whereby donors make aid conditional on the reform promises of recipient countries. However, hardly any empirical evidence exists on whether ex post rewards are effective in inducing reforms. We attempt...

Using data from 1988 to 2007, we examine to what extent bilateral aid flows of an individual donor to a country depend on aid flows from all other bilateral and multilateral donors to that country. We thereby want to assess to what extent donor coordination, free-riding, selectivity,...

The governments of many developing countries seek to attract inbound foreign direct investment (FDI) through the use of tax incentives for multinational corporations (MNCs). The effectiveness of these tax incentives depends crucially on MNCs' residence country tax regime, especially where the...

We examine how donor government ideology influences the composition of foreign aid flows. We use data for 23 OECD countries over the period 1960‐2009 and distinguish between multilateral and bilateral aid, grants and loans, recipient characteristics such as income and political institutions,...

This paper studies the effects of bilateral foreign aid on conflict escalation and de-escalation. We make three major contributions. First, we combine data on civil wars with data on low level conflicts in a new ordinal measure capturing the two-sided and multifaceted nature of conflict. Second,...

International humanitarian aid is pivotal in the response to natural disasters suffered by low-and middle-income countries. While its allocation has been shown to be influenced by donors' foreign policy considerations, power relations within recipient countries have not been addressed. This...