This study - commissioned by the German Ministry for Economic Cooperation and Development (BMZ) – evaluates the direct effects (i.e. the direct and induced outputs) of budget support in Zambia. It forms part of a joint international evaluation of budget support in Zambia. The report focuses on...

Development assistance has for many decades been aiming to support developing countries’ strategies to achieve more sustainable development. Yet, evidence shows that the impact of such assistance has been well below expectations. This study examines the efforts of assistance providers and...

The impact of aid inflows on relative prices and output is ambiguous. Aid inflows that increase domestic expenditure are likely to cause real exchange rate appreciation, ceteris paribus. However, if this expenditure raises the capital stock in the traded goods sector, then output in this sector...

While we know a lot about how countries become prosperous, we have only begun to understand how aid contributes to economic growth and poverty reduction. The development record is mixed and no robust association between the volume of aid and development performance has been discovered. The...