Aid and Growth Accelerations: An Alternative Approach to Assessing the Effectiveness of Aid

25 Pages Posted: 20 Jul 2007

See all articles by Jonas Dovern

Jonas Dovern

Kiel Institute for the World Economy

Peter Nunnenkamp

University of Kiel

Abstract

The paper applies an alternative approach to assess whether foreign aid promotes economic growth in developing countries, based on the concept of temporary growth accelerations suggested by Hausmann, Pritchett and Rodrik. In addition to aggregate aid, we 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. However, the significance of results crucially depends on the criteria applied to identify growth accelerations.

Suggested Citation

Dovern, Jonas and Nunnenkamp, Peter, Aid and Growth Accelerations: An Alternative Approach to Assessing the Effectiveness of Aid. Kyklos, Vol. 60, No. 3, pp. 359-383, August 2007. Available at SSRN: https://ssrn.com/abstract=1001366 or http://dx.doi.org/10.1111/j.1467-6435.2007.00376.x

Jonas Dovern (Contact Author)

Kiel Institute for the World Economy ( email )

Duesternbrooker Weg 120
Kiel, 24105
Germany
+49-431-8814-266 (Phone)

HOME PAGE: http://www.ifw-members.ifw-kiel.de/Members/jonas_dovern_ifw_kiel_de/jonas_dovern_ifw_kiel_de

Peter Nunnenkamp

University of Kiel ( email )

D-24100 Kiel
Germany

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