Does foreign aid really raise per capita income? A time series perspective
2012 | journal article
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Cite this publication
Nowak-Lehmann, Felicitas, et al. "Does foreign aid really raise per capita income? A time series perspective." Canadian Journal of Economics/Revue canadienne d'économique, vol. 45, no. 1, 2012, pp. 288-313, doi: 10.1111/j.1540-5982.2011.01696.x.
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Details
- Title Variant(s)
- Est‐ce que l’aide étrangère augmente vraiment le revenu per capita? Une approche par les séries chronologiques.
- Authors
- Nowak-Lehmann, Felicitas ; Dreher, Axel ; Herzer, Dierk; Klasen, Stephan ; Martínez-Zarzoso, Inmaculada
- Abstract
- We analyze the relationship between per capita income and foreign aid. We employ annual data and five‐year averages and carefully examine the time‐series properties of the data. Panel estimations with dynamic feasible generalized least‐squares (DFGLS) show that aid generally has an insignificant or minute negative significant impact on per capita income (particularly in highly aid‐dependent countries). This holds true for countries with different levels of human development and income, as well as for different regions. We also find that aid has a small positive impact on investment, but a significant negative impact on domestic savings (crowding out) and the real exchange rate (appreciation).
- Issue Date
- 2012
- Journal
- Canadian Journal of Economics/Revue canadienne d'économique
- Language
- English