A BEJM Contributions article.

Abstract

This paper analyzes the impact of foreign aid on growth. It differs from the existing literature in at least two important ways. First, we differentiate between foreign aid as technical assistance and non-technical assistance, and demonstrate both theoretically and empirically that this distinction is important. Second, we test the hypothesis that the effectiveness of aid depends on its level of fragmentation. To preview our main results: non-technical assistance has no statistically significant impact on growth; but technical assistance has a positive and significant impact, except in countries where it is highly fragmented.

Submitted: November 27, 2008 · Accepted: July 24, 2009 · Published: August 12, 2009

Recommended Citation

Annen, Kurt and Kosempel, Stephen (2009) "Foreign Aid, Donor Fragmentation, and Economic Growth," The B.E. Journal of Macroeconomics: Vol. 9 : Iss. 1 (Contributions), Article 33.
DOI: 10.2202/1935-1690.1863
Available at: http://www.bepress.com/bejm/vol9/iss1/art33