Aid Volatility: An Empirical Assessment

IMF Staff Papers, Vol. 50, No. 1, pp.64-89, 2003

26 Pages Posted: 17 Jan 2006  

Aleš Bulíř

International Monetary Fund (IMF)

A. Javier Hamann

International Monetary Fund (IMF) - Independent Evaluation Office

Abstract

This article examines empirical evidence on the volatility and uncertainty of aid flows and their main policy implications. Aid is found to be more volatile than fiscal revenues - particularly in highly aid-dependent countries - and shortfalls in aid and domestic revenue tend to coincide. The article also finds that uncertainty about aid disbursements is large and that the information content of commitments made by donors is either very small or statistically insignificant. Specific policies and broader international efforts to cope with these features of aid are briefly discussed.

Keywords: Aid, volatility, uncertainty, IMF programs, fiscal revenue

JEL Classification: F35, O19

Suggested Citation

Bulíř, Aleš and Hamann, A. Javier, Aid Volatility: An Empirical Assessment. IMF Staff Papers, Vol. 50, No. 1, pp.64-89, 2003. Available at SSRN: https://ssrn.com/abstract=875633

Ales Bulir (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

Alfonso Javier Hamann

International Monetary Fund (IMF) - Independent Evaluation Office ( email )

700 19th St. NW
Washington, DC 20431
United States

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