Uncertainty of aid inflows and the growth relationship
Autor(a) principal: | |
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Data de Publicação: | 1999 |
Tipo de documento: | Artigo |
Idioma: | eng |
Título da fonte: | Repositório Institucional do FGV (FGV Repositório Digital) |
Texto Completo: | http://hdl.handle.net/10438/12245 |
Resumo: | This paper contributes to the literature on aid and economic growth. We posit that it is not the levei of aid flows per se but the stability of such flows that determines the impact of aid on economic growth. Three measures of aid instability are employed. One is a simple deviation from trend, and measures overall instability. The other measures are based on auto-regressive estimates to capture deviations from an expected trend. These measures are intended to proxy for uncertainty in aid receipts. We posit that such uncertainty will influence the relationship between aid and investment and how recipient governments respond to aid, and will therefore affect how aid impacts on growth. We estimate a standard cross-country growth regression including the leveI of aid, and find aid to be insignificant (in line with other results in the literature). We then introduce measures of instability. Aid remains insignificant when we account for overall instability. However, when we account for uncertainty (which is negative and significant), we find that aid has a significant positive effect on growth. We conduct stability tests that show that the significance of aid is largely due to its effect on the volume of investment. The finding that uncertainty of aid receipts reduces the effectiveness of aid is robust. When we control for this, aid appears to have a significant positive influence on growth. When the regression is estimated for the sub-sample of African countries these findings hold, although the effectiveness of aid appears weaker than for the full sample. |
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Morrisey, OliverEscolas::EPGEFGV2014-10-28T10:44:20Z2014-10-28T10:44:20Z1999-04-15http://hdl.handle.net/10438/12245This paper contributes to the literature on aid and economic growth. We posit that it is not the levei of aid flows per se but the stability of such flows that determines the impact of aid on economic growth. Three measures of aid instability are employed. One is a simple deviation from trend, and measures overall instability. The other measures are based on auto-regressive estimates to capture deviations from an expected trend. These measures are intended to proxy for uncertainty in aid receipts. We posit that such uncertainty will influence the relationship between aid and investment and how recipient governments respond to aid, and will therefore affect how aid impacts on growth. We estimate a standard cross-country growth regression including the leveI of aid, and find aid to be insignificant (in line with other results in the literature). We then introduce measures of instability. Aid remains insignificant when we account for overall instability. However, when we account for uncertainty (which is negative and significant), we find that aid has a significant positive effect on growth. We conduct stability tests that show that the significance of aid is largely due to its effect on the volume of investment. The finding that uncertainty of aid receipts reduces the effectiveness of aid is robust. When we control for this, aid appears to have a significant positive influence on growth. When the regression is estimated for the sub-sample of African countries these findings hold, although the effectiveness of aid appears weaker than for the full sample.engEscola de Pós-Graduação em Economia da FGVSeminários de pesquisa econômica da EPGETodo cuidado foi dispensado para respeitar os direitos autorais deste trabalho. Entretanto, caso esta obra aqui depositada seja protegida por direitos autorais externos a esta instituição, contamos com a compreensão do autor e solicitamos que o mesmo faça contato através do Fale Conosco para que possamos tomar as providências cabíveisinfo:eu-repo/semantics/openAccessUncertainty of aid inflows and the growth relationshipinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleEconomiaDesenvolvimento econômicoAssistência econômicareponame:Repositório Institucional do FGV (FGV Repositório Digital)instname:Fundação Getulio Vargas (FGV)instacron:FGVORIGINAL000089246.pdf000089246.pdfapplication/pdf968693https://repositorio.fgv.br/bitstreams/0a0bcce8-5a34-4819-989d-c51d5c717d76/downloadccd79acf154d99a9d231ea05603f9811MD51LICENSElicense.txtlicense.txttext/plain; charset=utf-84707https://repositorio.fgv.br/bitstreams/db1c137e-e096-44fe-864b-0229c479cd92/downloaddfb340242cced38a6cca06c627998fa1MD52TEXT000089246.pdf.txt000089246.pdf.txtExtracted 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dc.title.eng.fl_str_mv |
Uncertainty of aid inflows and the growth relationship |
title |
Uncertainty of aid inflows and the growth relationship |
spellingShingle |
Uncertainty of aid inflows and the growth relationship Morrisey, Oliver Economia Desenvolvimento econômico Assistência econômica |
title_short |
Uncertainty of aid inflows and the growth relationship |
title_full |
Uncertainty of aid inflows and the growth relationship |
title_fullStr |
Uncertainty of aid inflows and the growth relationship |
title_full_unstemmed |
Uncertainty of aid inflows and the growth relationship |
title_sort |
Uncertainty of aid inflows and the growth relationship |
author |
Morrisey, Oliver |
author_facet |
Morrisey, Oliver |
author_role |
author |
dc.contributor.unidadefgv.por.fl_str_mv |
Escolas::EPGE |
dc.contributor.affiliation.none.fl_str_mv |
FGV |
dc.contributor.author.fl_str_mv |
Morrisey, Oliver |
dc.subject.area.por.fl_str_mv |
Economia |
topic |
Economia Desenvolvimento econômico Assistência econômica |
dc.subject.bibliodata.por.fl_str_mv |
Desenvolvimento econômico Assistência econômica |
description |
This paper contributes to the literature on aid and economic growth. We posit that it is not the levei of aid flows per se but the stability of such flows that determines the impact of aid on economic growth. Three measures of aid instability are employed. One is a simple deviation from trend, and measures overall instability. The other measures are based on auto-regressive estimates to capture deviations from an expected trend. These measures are intended to proxy for uncertainty in aid receipts. We posit that such uncertainty will influence the relationship between aid and investment and how recipient governments respond to aid, and will therefore affect how aid impacts on growth. We estimate a standard cross-country growth regression including the leveI of aid, and find aid to be insignificant (in line with other results in the literature). We then introduce measures of instability. Aid remains insignificant when we account for overall instability. However, when we account for uncertainty (which is negative and significant), we find that aid has a significant positive effect on growth. We conduct stability tests that show that the significance of aid is largely due to its effect on the volume of investment. The finding that uncertainty of aid receipts reduces the effectiveness of aid is robust. When we control for this, aid appears to have a significant positive influence on growth. When the regression is estimated for the sub-sample of African countries these findings hold, although the effectiveness of aid appears weaker than for the full sample. |
publishDate |
1999 |
dc.date.issued.fl_str_mv |
1999-04-15 |
dc.date.accessioned.fl_str_mv |
2014-10-28T10:44:20Z |
dc.date.available.fl_str_mv |
2014-10-28T10:44:20Z |
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dc.identifier.uri.fl_str_mv |
http://hdl.handle.net/10438/12245 |
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http://hdl.handle.net/10438/12245 |
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eng |
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eng |
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Seminários de pesquisa econômica da EPGE |
dc.rights.driver.fl_str_mv |
info:eu-repo/semantics/openAccess |
eu_rights_str_mv |
openAccess |
dc.publisher.none.fl_str_mv |
Escola de Pós-Graduação em Economia da FGV |
publisher.none.fl_str_mv |
Escola de Pós-Graduação em Economia da FGV |
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