The Burnside and Dollar (2000) finding that aid raises growth in a good policy environment has had an important influence on policy and academic debates. We conduct a data gathering exercise that updates their data from 1970-93 to 1970-97, as well as filling in missing data for the original...

The Burnside and Dollar (2000) finding that aid raises growth in a good policy environment has had an important influence on policy and academic debates. We conduct a data gathering exercise that updates their data from 1970-93 to 1970-97, as well as filling in missing data for the original...

The paper compares different aid policy instruments and their effect on the target group. Starting from a situation where interest groups compete for the resources of the government, international financial institutions aim to change the policy outcome. They can either directly support one group...

The most recent literature on aid effectiveness finds a positive effect of aid on growth. To the extent that aid goes through the budget, this either reflects an aid-financed increase in government expenditures (quantity effect) or an improvement in the use of government resources as a result of...

The ‘right' choice of instruments and modalities to provide aid to developing countries in support of poverty reduction and economic development is arguably the most contested issue in the current international debate on aid effectiveness. A particular controversy exists around the provision...

Should donors who are interested in the effectiveness of developmental programs rely on conditional budget support or on project aid? To answer this question, we present a model in which only a subset of the developmental expenditures can be subject to conditionality. We show that budget support...

This paper studies how macroeconomic policies can help offset two unintended and undesirable features of foreign aid: its volatility and Dutch disease. We present evidence that aid volatility augments trade balance volatility and that foreign aid, with the important exception of years of adverse...

After more than a decade of economic decline and civil war, Uganda was able to return to economic growth thanks to the policies pursued by Museveni’s National Resistance Movement which elicited considerable donor support. They include macroeconomic reforms, public sector restructuring,...

The ethnic conflicts in Burundi and Rwanda have severely weakened the economies and worsened the structural fiscal imbalances of these countries. Government revenue has declined due to the erosion of the tax base and tax administration capacity. At the same time, governments have shifted the...

It is clear from the implications of growth theory that the impact of aid depends on how it affects savings, investment and government behaviour. In respect of low-income countries, which are the principal aid recipients and the economies for which the issue of the impact of aid on growth is...