Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/48163
Authors: 
Lessmann, Christian
Markwardt, Gunther
Year of Publication: 
2010
Series/Report no.: 
Dresden discussion paper series in economics 10/10
Abstract: 
This paper empirically studies the impact of decentralization and inter-jurisdictional competition on foreign aid effectiveness. For this purpose we examine a commonly used empirical growth model, considering different measures of fiscal decentralization. Our panel estimations reveal that expenditure decentralization and inter-jurisdictional competition - reflected by the degree of tax revenue decentralization - negatively impact aid effectiveness. We therefore conclude that donor countries should carefully consider how both anti-poverty instruments - foreign assistance and decentralization - work together.
Subjects: 
Foreign Aid
Growth
Interjurisdictional Competition
JEL: 
O1
O2
O4
H7
Document Type: 
Working Paper

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