We revisit the ubiquitous claim that aiding civil society improves institutional outcomes. In our model, a vibrant civil society initiates public debate in a reform process that would otherwise be dominated by partisan interest groups and politicians. By altering the incentives of interest...

The Developing world suffers from the economic delay behind developed economies which is allied with poverty, a high pace of population growth, illiteracy, malnutrition and the degradation of environment. This fact requires more and more international development aid that should lead to...

This paper explores the steady state welfare implications of permanent transfers in a two-country, two-sector overlapping generations model. At the golden rule and with Walrasian stability, we demonstrate that the change in the (static) terms of trade always works in favor of a transfer paradox....

This paper examines the effects of international income transfers on welfare and capital accumulation in a one-sector overlapping generations model. It is shown that a strong form of the transfer paradox-- in which the donor country experiences a welfare gain while the recipient country...

At present, the enhanced HIPC initiative and the Gleneagles Proposal for debt write-downs by the G8 are the main mechanisms used to reduce indebtedness of low-income countries. In these countries where poor governance is a key issue, it is naïve to believe that the Millennium Development Goals...

The Aid for Trade (AFT) Initiative was announced at the 2005 Hong-Kong World Trade Organisation (WTO) ministerial. Then, Doha round talks were stalled as developing countries were disenchanted with the world trading system they had signed up to a decade earlier under the Single Undertaking,...

The Aid for Trade (AFT) Initiative was announced at the 2005 Hong-Kong World Trade Organisation (WTO) ministerial. Then, Doha round talks were stalled as developing countries were disenchanted with the world trading system they had signed up to a decade earlier under the Single Undertaking,...

Donors who try to impose policy conditionality on countries receiving their aid commonly face confflicting incentives between using aid to induce income-increasing reforms and using aid to assist low-income countries: this confflict can lead to a time-consistency problem. This paper o¤ers a...

Recent literature has debated possible adverse impacts of aid volatility on a country's economic performance. Our paper adds to this literature in three ways: First it tests the validity of the aid volatility and growth relationship from various aspects: across time horizons, by sources of aid,...

This study estimates an aid-growth model and an aid-fiscal model to quantify the effects of foreign aid on GDP growth and fiscal behavior in Bangladesh over the 1973-1999 period. The aid-growth model applies the cointegration method to a neoclassical growth model and finds that aid has marginal...