Aid, Debt Burden and Government Fiscal Behaviour in Cote D'Ivoire
CREDIT Research Paper No. 03/05
27 Pages Posted: 23 Jul 2003
Date Written: April 2003
This paper examines the impact of foreign aid on public sector fiscal behaviour in Cote d'Ivoire. A special interest is the relationship between aid, debt servicing and debt, given that Cote d'Ivoire is a highly indebted country. The theoretical model employed differs from those of previous studies by highlighting the interaction between debt servicing and the other fiscal variables. This model is estimated using 1975-99 time series data. Key findings are that the bulk of aid is allocated to debt servicing and that aid is associated with increases in the level of public debt.
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