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There is little consensus on the capacity for foreign aid to cause economic growth in developing countries. This is due in large part to the fact that foreign aid recipients are selected by donors, confounding identification. This paper proposes an identification strategy that exploits exogenous...
Persistent link: https://www.econbiz.de/10013005040
Foreign aid is an important means of finance for governments of developing countries. The current study investigates whether too much inflow of aid to developing countries is beneficial or harmful to their economy and whether institutional quality and economic freedom matters in aid–growth...
Persistent link: https://www.econbiz.de/10013460262
This paper explores the impact of foreign aid on economic growth using variation in aid inflows from natural disasters. Because using a country's own disaster exposure as an instrument for aid inflows violates exogeneity assumptions, I instead use the disaster exposure of a country's "aid...
Persistent link: https://www.econbiz.de/10014153490
instability, namely terms-of-trade instability, on the quality of democracy. We take advantage of previous empirical findings …, aggregate aid flows can potentially dampen the effects of terms-of-trade instability on the quality of democracy. An empirical … results. -- democracy ; foreign aid ; terms-of-trade instability …
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The link between foreign aid and economic growth remains a controversial issue in the literature, and a large share of the disagreement could be explained by differences in the data employed. Using GDP data from three different versions of the Penn World Table and the World Development...
Persistent link: https://www.econbiz.de/10011375893
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standard panel estimation techniques, such as 2-ways FE estimation, panel GMM and SUR estimation, points to some pitfalls … dynamic feasible generalized least squares estimation (DFGLS)). Estimations with DFGLS show that aid has an insignificant or a …
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