Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/90538 
Year of Publication: 
2010
Series/Report no.: 
Discussion Papers No. 29
Publisher: 
Georg-August-Universität Göttingen, Courant Research Centre - Poverty, Equity and Growth (CRC-PEG), Göttingen
Abstract: 
It is widely believed that the Millennium Challenge Corporation (MCC) has grossly fallen short of high expectations raised by the Bush administration in 2002. From the perspective of potential recipient countries, the crucial issue is whether the MCC increased the overall pool of aid resources available to them. We argue that this question extends far beyond the distribution of the limited MCC resources. By employing OLS and treatment-effects estimations, we assess how other US aid agencies and non-US donors reacted to MCC decisions. We find that positive signaling effects tend to dominate possible substitution effects not only for overall US aid but also for multilateral donors. Regarding other bilateral donors the evidence is mixed.
Subjects: 
official development aid
Millennium Challenge Corporation
additionality
signaling
United States
other DAC donors
JEL: 
F35
Document Type: 
Working Paper

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