Tagged: Economic aid

New publications from OECD, mid July 2015

New OECD publications have been uploaded to the OECD iLibrary, a comprehensive digital repository of books, papers, and statistics from the Organisation for Economic Cooperation and Development (OECD). Titles recently added include:

These volumes and more are accessible from the OECD iLibrary by WTO staff and WTO Library patrons.


Aid for food security: does it work?

The paper’s objective is to contribute to existing literature by examining whether development aid has any measurable impact on food security, whether the impact is conditioned on the quality of governance, and whether it differs based on the type of aid provided.
The paper finds that aid in general has a small positive impact on food security; that multilateral aid, grants, and social and economic aid have a positive effect on food security in their own right; and that bilateral aid, loans, and agricultural aid are more conditioned on the quality of governance that other aid.

Full-text available in .pdf

Development Aid and Growth in Transition Countries

Empirical studies normally analyze diverse and heterogeneous groups of countries, producing very mixed evidence on the effectiveness of development aid in promoting growth. We focus on whether aid promotes economic growth in transitional economies. We find that aid, on average, has had a positive impact on growth for this specific group of countries. This result is robust to samples, estimators, and the use of alternate instruments to address endogeneity. Aid effectiveness is not conditional on good policy and there is little evidence of non-linear growth effects arising from aid.

Full-text available in .pdf

Aid Policy and the Macroeconomic Management of Aid

This is an introduction to the UNU-WIDER special issue of World Development on aid policy and the macroeconomic management of aid. We provide an overview of the 10 studies, grouping them under three sub-themes: the aid‚Äďgrowth relationship; the supply-side of aid (including its level, volatility, and coordination of donors); and the macroeconomic framework around aid.

Full-text available in .dpf

Aid for Trade: Do Those Countries that Need it, Get it? / Elisa Gamberoni and Richard Newfarmer

This paper is designed to help both the beneficiary governments and donors of aid for trade identify countries that are under-performing in trade and which are receiving less aid for trade than their global performance might otherwise suggest is necessary. Building on previous work, it provides a procedure to assess potential need for spurring trade volume, and then looks at country allocations of aid for trade to see which are receiving below-average amounts in the supply of aid for trade ‚Äď relative to their potential needs. Countries, as they design national development strategies, may wish to consider giving greater attention to trade and requesting that donors allocate to them more aid for trade. As part of the analysis, the paper provides a conceptual framework for selecting indicators of trade performance and its policy determinants that the WTO and its partners might monitor closely as part of the aid for trade initiative.

Full-text available in .pdf

Aid for Trade Effectiveness: Complementarities with Economic Integration / Mariana Vijil

Developing countries are increasingly using regional integration as a main policy lever when pursuing a trade-led growth strategy, and today, ‚Äėdeep‚Äô preferential trade agreements go beyond trade policy negotiations and cover trade facilitation issues. Since aid for trade (AfT) has been recognised as a powerful instrument for increasing developing countries’ trade capacity by targeting internal trade costs, this article tests whether complementarities exist between this type of aid and economic integration using a gravity model on panel data for the period 1995‚Äď2005. Results indicate that AfT, when combined with economic integration, has been effective in increasing trade flows. Both South‚ÄďSouth and North‚ÄďSouth trade flows have benefited, and the combination of the two instruments has been particularly effective in expanding the South’s exports to the North. Finally, when breaking down AfT into categories, assistance to trade-related institutions seems to generate the strongest complementarities with economic integration.

Full-text available in .pdf

The Impact of Aid and Public Investment Volatility on Economic Growth in Sub-Saharan Africa / Malimu Museru, Francois Toerien, Sean Gossel

This study investigates the effects of aid inflows and the volatility of public investment on economic growth in 26 Sub-Saharan African countries over the period from 1992 to 2011. Three volatility variables comprising aid, government revenue, and public investment are incorporated into an aid-growth model to test for their effect on economic growth. Using the Generalized Method of Moments (GMM) technique and averaged data for five four-year sub-periods, we show that although foreign aid has a positive impact on growth once potential endogeneity has been accounted for, aid effectiveness may have been eroded by volatility in public investment.

Full-text available in .pdf