Development Aid and Economic Growth: A Positive Long-Run Relation

35 Pages Posted: 8 Jun 2009

See all articles by Camelia Minoiu

Camelia Minoiu

Federal Reserve Board

Sanjay G. Reddy

The New School - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: June 2009

Abstract

We analyze the growth impact of official development assistance to developing countries.Our approach is different from that of previous studies in two major ways. First, we disentangle the effects of two kinds of aid: developmental and non-developmental. Second,our specifications allow for the effect of aid on economic growth to occur over long periods.Our results indicate that developmental aid promotes long-run growth. The effect is significant, large and robust to different specifications and estimation techniques.

Keywords: Cross country analysis, Developing countries, Development assistance, Economic growth, Economic models, Resource mobilization

Suggested Citation

Minoiu, Camelia and Reddy, Sanjay G., Development Aid and Economic Growth: A Positive Long-Run Relation (June 2009). IMF Working Papers, Vol. , pp. 1-32, 2009. Available at SSRN: https://ssrn.com/abstract=1415175

Camelia Minoiu (Contact Author)

Federal Reserve Board ( email )

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Washington, DC 20551
United States

Sanjay G. Reddy

The New School - Department of Economics ( email )

Room 1116
6 East 16th Street
New York, NY 10003
United States

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