Does Terror Increase Aid?

Courant Research Centre Discussion Paper No. 86

37 Pages Posted: 26 Aug 2011

See all articles by Axel Dreher

Axel Dreher

Heidelberg University

Andreas Fuchs

University of Goettingen (Gottingen) - Faculty of Economics and Business Administration; Kiel Institute for the World Economy

Date Written: August 12, 2011

Abstract

This article empirically investigates whether, and in which ways, donors in the Development Assistance Committee respond to transnational terrorist incidents and the onset of the War on Terror through changes in aid effort and aid allocation. First, an analysis of 22 donor countries shows that aid effort increased during the War on Terror period, but did not respond to the actual number of terror events. Second, using aid allocation equations, we find that countries where terror originates are not more likely to receive aid as a consequence, but if they are selected, they receive larger amounts of aid.

Keywords: Foreign Aid, Transnational Terrorism, War on Terror and Aid, DAC Donors, Heckman Selection Model

JEL Classification: F35

Suggested Citation

Dreher, Axel and Fuchs, Andreas, Does Terror Increase Aid? (August 12, 2011). Courant Research Centre Discussion Paper No. 86. Available at SSRN: https://ssrn.com/abstract=1915635 or http://dx.doi.org/10.2139/ssrn.1915635

Axel Dreher (Contact Author)

Heidelberg University ( email )

Grabengasse 1
Heidelberg, 69117
Germany

HOME PAGE: http://www.axel-dreher.de

Andreas Fuchs

University of Goettingen (Gottingen) - Faculty of Economics and Business Administration ( email )

Platz der Goettinger Sieben 3
Goettingen, 37073
Germany

Kiel Institute for the World Economy ( email )

Kiellinie 66
Kiel, Schleswig-Hosltein 24105
Germany

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