Tracking Under-Reported Financial Flows: China's Development Finance and the Aid-Conflict Nexus Revisited

University of Heidelberg Department of Economics Discussion Paper Series No. 553

45 Pages Posted: 24 Jan 2014

See all articles by Austin Strange

Austin Strange

Harvard University, Faculty of Arts and Sciences, Department of Government

Bradley Parks

College of William and Mary

Michael J. Tierney

College of William and Mary

Andreas Fuchs

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

Axel Dreher

Heidelberg University

Multiple version iconThere are 2 versions of this paper

Date Written: January 22, 2014

Abstract

China’s development finance is sizable but reliable information is scarce. To address critical information gaps, we introduce a new open source methodology for collecting project-level development finance information and create a database of Chinese official finance to Africa from 2000-2011. Our initial data collection efforts found that China’s official finance commitments amount to approximately US $73 billion over the 2000-2011 period. We provide details on 1,511 non-investment projects to 50 African countries. We use this database to extend previous research on the aid-conflict nexus. Our results show that sudden withdrawals of “traditional” aid are only more likely to induce conflict in the absence of sufficient alternative funding from China. More broadly, these findings highlight the importance of gathering better data on the development activities of China and other non-traditional donors to better understand the link between foreign aid and conflict.

Keywords: Development Finance; Foreign Aid, Non-DAC Donors, South-South Cooperation, China, Aid Shocks, Violent Armed Conflict

JEL Classification: F35, O19, O22

Suggested Citation

Strange, Austin and Parks, Bradley and Tierney, Michael J. and Fuchs, Andreas and Dreher, Axel, Tracking Under-Reported Financial Flows: China's Development Finance and the Aid-Conflict Nexus Revisited (January 22, 2014). University of Heidelberg Department of Economics Discussion Paper Series No. 553. Available at SSRN: https://ssrn.com/abstract=2384103 or http://dx.doi.org/10.2139/ssrn.2384103

Austin Strange

Harvard University, Faculty of Arts and Sciences, Department of Government ( email )

1737 Cambridge Street
Cambridge, MA 02138
United States

Bradley Parks

College of William and Mary ( email )

No Address Available

Michael J. Tierney

College of William and Mary ( email )

P.O. Box 8795
Williamsburg, VA 23185
United States

Andreas Fuchs (Contact Author)

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

Axel Dreher

Heidelberg University ( email )

Grabengasse 1
Heidelberg, 69117
Germany

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

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