EconStor >
United Nations University (UNU) >
World Institute for Development Economics Research (UNU-WIDER), United Nations University >
WIDER Research Papers, United Nations University (UNU) >

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

http://hdl.handle.net/10419/45056
  

Full metadata record

DC FieldValueLanguage
dc.contributor.authorChauvet, Lisaen_US
dc.contributor.authorGuillaumont, Patricken_US
dc.date.accessioned2010-02-16en_US
dc.date.accessioned2011-04-26T07:40:00Z-
dc.date.available2011-04-26T07:40:00Z-
dc.date.issued2008en_US
dc.identifier.isbn978-92-9230-132-3en_US
dc.identifier.urihttp://hdl.handle.net/10419/45056-
dc.description.abstractIn previous papers we have argued that aid is likely to mitigate the negative effects of external shocks on economic growth (i.e., aid is more effective in countries that are more vulnerable to external shocks). Recently an important debate has emerged about the possible negative effects of aid volatility itself. However, the cushioning effect of aid may involve some volatility in aid flows, which then is not necessarily negative for growth. In this paper we examine to what extent the time profile of aid disbursements may contribute to an increase or a decrease of aid effectiveness. We first show that aid, even if volatile, is not clearly as procyclical as often argued, and, even if procyclical, is not necessarily destabilizing. We measure aid volatility by several methods and assess procyclicality of aid with respect to exports, thus departing from previous literature, which usually assesses procyclicality of aid with respect to national income or fiscal receipts. The stabilizing/destabilizing nature of aid is measured by the difference in the volatility of exports and the volatility of the aid plus exports flows. Then, in order to take into account the diversity of shocks to which aid can respond, we consider the effect of aid on income volatility and again find that aid is making growth more stable, while its volatility reduces this effect. Finally, we find evidence through growth regressions that the higher effectiveness of aid in vulnerable countries is to a large extent due to its stabilizing effect.en_US
dc.language.isoengen_US
dc.publisherUNU-WIDER Helsinkien_US
dc.relation.ispartofseriesResearch paper / UNU-WIDER 2008.78en_US
dc.subject.jelF35en_US
dc.subject.jelF43en_US
dc.subject.jelO42en_US
dc.subject.ddc330en_US
dc.subject.keywordaiden_US
dc.subject.keywordshocksen_US
dc.subject.keywordstabilityen_US
dc.subject.keywordgrowthen_US
dc.subject.stwEntwicklungshilfeen_US
dc.subject.stwVolatilit├Ąten_US
dc.subject.stwSchocken_US
dc.subject.stwWirtschaftswachstumen_US
dc.titleAid, volatility and growth again: When aid volatility matters and when it does noten_US
dc.typeWorking Paperen_US
dc.identifier.ppn589773577en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen_US
Appears in Collections:WIDER Research Papers, United Nations University (UNU)

Files in This Item:
File Description SizeFormat
589773577.pdf171.45 kBAdobe PDF
No. of Downloads: Counter Stats
Show simple item record
Download bibliographical data as: BibTeX

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