Aid Does Matter after All: Revisiting the Relationship between Aid and Growth

, Forthcoming

17 Pages Posted: 6 Feb 2007 Last revised: 15 Mar 2016

See all articles by Camelia Minoiu

Camelia Minoiu

Federal Reserve Board

Sanjay G. Reddy

The New School - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: February 1, 2007

Abstract

Recent influential studies among development economists claim that aid to developing countries is not nearly as beneficial to recipient nations as had been expected. Are these statistical analyses right? One problem is that total aid, on which most studies are based, includes two distinct kinds of aid. The first is what we might call "developmental" aid, and the second, geopolitical aid. When the authors focus only on the first kind of aid, they find strong correlations between the level of such aid and average economic growth experienced over the long term. Moreover, they do not find that aid is only effective under specific policy conditions.

Keywords: official development assistance, developmental aid, economic growth

JEL Classification: O1, O2, O4

Suggested Citation

Minoiu, Camelia and Reddy, Sanjay G., Aid Does Matter after All: Revisiting the Relationship between Aid and Growth (February 1, 2007). , Forthcoming. Available at SSRN: https://ssrn.com/abstract=960877 or http://dx.doi.org/10.2139/ssrn.960877

Camelia Minoiu (Contact Author)

Federal Reserve Board ( email )

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Sanjay G. Reddy

The New School - Department of Economics ( email )

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New York, NY 10003
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