Aid and Savings in Sub-saharan Africa: Should we Worry about Rising Aid Levels?

Detalhes bibliográficos
Autor(a) principal: Serieux, John
Data de Publicação: 2009
Tipo de documento: Artigo
Idioma: eng
Título da fonte: Repositório Institucional da IPEA (RCIpea)
dARK ID: ark:/51990/001300000g3n1
Texto Completo: https://repositorio.ipea.gov.br/handle/11058/15127
Resumo: This paper examines the effect of aid on domestic savings in Sub-Saharan Africa. It departs from the previous literature on aid and savings in developing countries by abandoning the pervasive, but untenable, assumption that all aid is used to expand the trade deficit and thus applied wholly to consumption or investment. In fact, for the period 1965-2006, the evidence suggests that 35% of any increase in aid relative to output was used to finance reverse flows (some combination of interest payments, debt amortization, capital flight and reserve increases), 41% was used to increase consumption relative to output (meaning a reduction in the domestic savings rates) and 24% was used to increase the rate of investment. However, during the extended period of increasing aid levels from the early 1970s to mid 1990s, reverse flows were a larger proportion of aid but more aid was invested and less was consumed. Also, concerns about potential aid hangovers, when current high aid levels subside, can be assuaged by the evidence that that effect has been historically uncommon in the region despite many episodes of high aid levels followed by sharp declines. (...)
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spelling Aid and Savings in Sub-saharan Africa: Should we Worry about Rising Aid Levels?AidSavingsSub-saharanAfricaThis paper examines the effect of aid on domestic savings in Sub-Saharan Africa. It departs from the previous literature on aid and savings in developing countries by abandoning the pervasive, but untenable, assumption that all aid is used to expand the trade deficit and thus applied wholly to consumption or investment. In fact, for the period 1965-2006, the evidence suggests that 35% of any increase in aid relative to output was used to finance reverse flows (some combination of interest payments, debt amortization, capital flight and reserve increases), 41% was used to increase consumption relative to output (meaning a reduction in the domestic savings rates) and 24% was used to increase the rate of investment. However, during the extended period of increasing aid levels from the early 1970s to mid 1990s, reverse flows were a larger proportion of aid but more aid was invested and less was consumed. Also, concerns about potential aid hangovers, when current high aid levels subside, can be assuaged by the evidence that that effect has been historically uncommon in the region despite many episodes of high aid levels followed by sharp declines. (...)32 p. : il.2024-10-03T23:51:24Z2024-10-03T23:51:24Z2009info:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleapplication/pdfhttps://repositorio.ipea.gov.br/handle/11058/15127ark:/51990/001300000g3n1International Policy Centre for Inclusive GrowthUnited Nations Development ProgrammeLicença total exclusivaO texto e dados desta publicação podem ser reproduzidos desde que as fontes sejam citadas. Reproduções com fins comerciais são proibidas.info:eu-repo/semantics/openAccessSerieux, Johnengreponame:Repositório Institucional da IPEA (RCIpea)instname:Instituto de Pesquisa Econômica Aplicada (IPEA)instacron:IPEA2024-10-04T06:13:10Zoai:repositorio.ipea.gov.br:11058/15127Repositório InstitucionalPUBhttp://repositorio.ipea.gov.br/oai/requestsuporte@ipea.gov.bropendoar:2024-10-04T06:13:10Repositório Institucional da IPEA (RCIpea) - Instituto de Pesquisa Econômica Aplicada (IPEA)false
dc.title.none.fl_str_mv Aid and Savings in Sub-saharan Africa: Should we Worry about Rising Aid Levels?
title Aid and Savings in Sub-saharan Africa: Should we Worry about Rising Aid Levels?
spellingShingle Aid and Savings in Sub-saharan Africa: Should we Worry about Rising Aid Levels?
Serieux, John
Aid
Savings
Sub-saharan
Africa
title_short Aid and Savings in Sub-saharan Africa: Should we Worry about Rising Aid Levels?
title_full Aid and Savings in Sub-saharan Africa: Should we Worry about Rising Aid Levels?
title_fullStr Aid and Savings in Sub-saharan Africa: Should we Worry about Rising Aid Levels?
title_full_unstemmed Aid and Savings in Sub-saharan Africa: Should we Worry about Rising Aid Levels?
title_sort Aid and Savings in Sub-saharan Africa: Should we Worry about Rising Aid Levels?
author Serieux, John
author_facet Serieux, John
author_role author
dc.contributor.author.fl_str_mv Serieux, John
dc.subject.por.fl_str_mv Aid
Savings
Sub-saharan
Africa
topic Aid
Savings
Sub-saharan
Africa
description This paper examines the effect of aid on domestic savings in Sub-Saharan Africa. It departs from the previous literature on aid and savings in developing countries by abandoning the pervasive, but untenable, assumption that all aid is used to expand the trade deficit and thus applied wholly to consumption or investment. In fact, for the period 1965-2006, the evidence suggests that 35% of any increase in aid relative to output was used to finance reverse flows (some combination of interest payments, debt amortization, capital flight and reserve increases), 41% was used to increase consumption relative to output (meaning a reduction in the domestic savings rates) and 24% was used to increase the rate of investment. However, during the extended period of increasing aid levels from the early 1970s to mid 1990s, reverse flows were a larger proportion of aid but more aid was invested and less was consumed. Also, concerns about potential aid hangovers, when current high aid levels subside, can be assuaged by the evidence that that effect has been historically uncommon in the region despite many episodes of high aid levels followed by sharp declines. (...)
publishDate 2009
dc.date.none.fl_str_mv 2009
2024-10-03T23:51:24Z
2024-10-03T23:51:24Z
dc.type.status.fl_str_mv info:eu-repo/semantics/publishedVersion
dc.type.driver.fl_str_mv info:eu-repo/semantics/article
format article
status_str publishedVersion
dc.identifier.uri.fl_str_mv https://repositorio.ipea.gov.br/handle/11058/15127
dc.identifier.dark.fl_str_mv ark:/51990/001300000g3n1
url https://repositorio.ipea.gov.br/handle/11058/15127
identifier_str_mv ark:/51990/001300000g3n1
dc.language.iso.fl_str_mv eng
language eng
dc.rights.driver.fl_str_mv International Policy Centre for Inclusive Growth
United Nations Development Programme
Licença total exclusiva
info:eu-repo/semantics/openAccess
rights_invalid_str_mv International Policy Centre for Inclusive Growth
United Nations Development Programme
Licença total exclusiva
eu_rights_str_mv openAccess
dc.format.none.fl_str_mv application/pdf
dc.source.none.fl_str_mv reponame:Repositório Institucional da IPEA (RCIpea)
instname:Instituto de Pesquisa Econômica Aplicada (IPEA)
instacron:IPEA
instname_str Instituto de Pesquisa Econômica Aplicada (IPEA)
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institution IPEA
reponame_str Repositório Institucional da IPEA (RCIpea)
collection Repositório Institucional da IPEA (RCIpea)
repository.name.fl_str_mv Repositório Institucional da IPEA (RCIpea) - Instituto de Pesquisa Econômica Aplicada (IPEA)
repository.mail.fl_str_mv suporte@ipea.gov.br
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