EconStor >
Institut für Weltwirtschaft (IfW), Kiel >
Kieler Arbeitspapiere, IfW >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/3883
  
Title:Aid and growth accelerations: An alternative approach to assess the effectiveness of aid PDF Logo
Authors:Dovern, Jonas
Nunnenkamp, Peter
Issue Date:2006
Series/Report no.:Kieler Arbeitspapiere 1296
Abstract:It continues to be heavily disputed whether foreign aid promotes economic growth in developing countries. In most cross-country regressions, aid is considered effective only if it shifts recipient countries to a significantly higher and sustainable growth path. We apply an alternative approach which is less demanding, based on the concept of temporary growth accelerations suggested by Hausmann, Pritchett and Rodrik. In assessing what can reasonably be expected from the donors' modest aid efforts, we do not only employ aggregate aid data but we also differentiate between major aid categories, including grants, loans and so-called short-impact aid. It turns out that aid flows have a small but significantly positive effect on the conditional probability of growth accelerations. This result holds across different estimation methods. Short-impact aid is found to be more effective in this respect, while we reject the view that grants are superior to loans. To the contrary, we find a stronger effect of loans. Furthermore, aid has become more effective during the second half of our sample. Typically, however, the significance of results crucially depends on the criteria applied to identify growth accelerations.
Subjects:Aid effectiveness
Growth accelerations
Grants versus loans
Short-impact aid
JEL:F35
O11
Document Type:Working Paper
Appears in Collections:Publikationen von Forscherinnen und Forschern des IfW
Kieler Arbeitspapiere, IfW

Files in This Item:
File Description SizeFormat
kap1296.pdf319.92 kBAdobe PDF
No. of Downloads: Counter Stats
Download bibliographical data as: BibTeX
Share on:http://hdl.handle.net/10419/3883

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.