Foreign Aid, the Rule of Law, and Economic Development in Africa

24 Pages Posted: 8 Dec 2010

See all articles by Nicholas Adam Curott

Nicholas Adam Curott

Ball State University - Department of Economics

Date Written: December 7, 2010

Abstract

Foreign aid has failed to bring about any significant development results in the poor countries of Africa in over sixty years of existence. The failure of aid is due to the fact that development planning faces an insurmountable calculation problem. Attempting to salvage aid by making it more selective does not address this problem, and will not make aid effective. Aid by its very nature causes waste, corruption, politicization, privilege seeking, and statism, all of which are detrimental to economic development. Instead of relying on aid, African economies should occupy themselves with creating legal institutions that are commensurate with the protection of private property and the Rule of Law, which are foremost among the institutions necessary for sustainable, long run economic growth.

Keywords: Rule of Law, development, Africa, economic calculation

JEL Classification: O55, P41

Suggested Citation

Curott, Nicholas Adam, Foreign Aid, the Rule of Law, and Economic Development in Africa (December 7, 2010). Available at SSRN: https://ssrn.com/abstract=1721647 or http://dx.doi.org/10.2139/ssrn.1721647

Nicholas Adam Curott (Contact Author)

Ball State University - Department of Economics ( email )

Muncie, IN 47306-0340
United States

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