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Aid and growth accelerations: An alternative approach to assess the effectiveness of aid

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dc.creator Dovern, Jonas
dc.creator Nunnenkamp, Peter
dc.date 2006
dc.date.accessioned 2013-10-16T06:18:37Z
dc.date.available 2013-10-16T06:18:37Z
dc.date.issued 2013-10-16
dc.identifier http://hdl.handle.net/10419/3883
dc.identifier ppn:518059561
dc.identifier.uri http://koha.mediu.edu.my:8181/xmlui/handle/10419/3883
dc.description It continues to be heavily disputed whether foreign aid promotes economic growth in developing countries. In most cross-country regressions, aid is considered effective only if it shifts recipient countries to a significantly higher and sustainable growth path. We apply an alternative approach which is less demanding, based on the concept of temporary growth accelerations suggested by Hausmann, Pritchett and Rodrik. In assessing what can reasonably be expected from the donors' modest aid efforts, we do not only employ aggregate aid data but we also differentiate between major aid categories, including grants, loans and so-called short-impact aid. It turns out that aid flows have a small but significantly positive effect on the conditional probability of growth accelerations. This result holds across different estimation methods. Short-impact aid is found to be more effective in this respect, while we reject the view that grants are superior to loans. To the contrary, we find a stronger effect of loans. Furthermore, aid has become more effective during the second half of our sample. Typically, however, the significance of results crucially depends on the criteria applied to identify growth accelerations.
dc.language eng
dc.publisher Kiel Institute for the World Economy (IfW) Kiel
dc.relation Kieler Arbeitspapiere 1296
dc.rights http://www.econstor.eu/dspace/Nutzungsbedingungen
dc.subject F35
dc.subject O11
dc.subject ddc:330
dc.subject Aid effectiveness
dc.subject Growth accelerations
dc.subject Grants versus loans
dc.subject Short-impact aid
dc.subject Entwicklungshilfe
dc.subject Entwicklungsfinanzierung
dc.subject Wirtschaftspolitische Wirkungsanalyse
dc.subject Wirtschaftswachstum
dc.subject Schätzung
dc.subject Entwicklungsländer
dc.title Aid and growth accelerations: An alternative approach to assess the effectiveness of aid
dc.type doc-type:workingPaper

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