Past research on aid and growth is flawed because it typically examines the impact of aggregate aid on growth over a short period, usually four years, while significant portions of aid are unlikely to affect growth in such a brief time. We divide aid into three categories: (1) emergency and...

We examine how foreign aid can be used to induce a recipient country to engage in trade-policy reforms. First, we develop a two-country and two-period theoretical model where the donor's promise of aid in period 2 depends on the recipient's chosen tariff in period 1. Without aid, optimal tariff...

We employ censored least absolute deviations and multivariate Tobit estimators to investigate whether food aid flows from the main donor countries respond to recipient country needs as reflected in low food availability, low income, or both. We also explore the hypothesis that donor countries...

The Aid for Trade (AfT) initiative has gained much popularity since its launch at the World Trade Organization’s Ministerial Conference in 2005, and there are ongoing discussions on its effectiveness and potential to improve the integration of developing countries into the world economy. This...

Aid for Trade is a new international program to help developing countries meet the challenges of the multilateral trading system and benefit from the liberalization process. The European Union as the largest aid provider in the world is among the donors which has accepted this program and...

This paper examines whether foreign aid in education has a significant effect on growth. We take into consideration the heterogeneous nature of aid as well as the heterogeneity of aid recipients - we disaggregate the aid data into primary, secondary and higher education, and run separate...

The Aid for Trade Initiative needs to be revamped. This article describes the challenges the Initiative faces and describes the pros and cons of possible reforms. The Aid for Trade Initiative succeeded in mobilizing quickly a large amount of financial resources. However, because the Doha Round...

In multiple regressions, explanatory variables with simple correlation coefficients with the dependent variable below 0.1 in absolute value (such as aid with economic growth) may have very large and statistically significant estimated parameters which are unfortunately "outliers driven" and...

The Aid for Trade Initiative has reached its limits and is in a need to be revamped. This article describes the political economy that led to the launch of the Initiative and explains why it focused on the mobilization of financial resources. The mobilization of resources has been impressive...

There is a possibility that the development ministers of the Organisation for Economic Co-operation and Development (OECD) will agree on a new definition of official development assistance (ODA) at the end of 2014. Ongoing discussions on this matter may appear purely "technical" at first glance....