Aid, growth, and development: Have we come full circle?

Channing Arndt; Edward Samuel Jones; Finn Tarp

doi:10.2202/1948-1837.1121

Aid, growth, and development: Have we come full circle?

Channing Arndt, Edward Samuel Jones, Finn Tarp

4 Citations (Scopus)

Abstract

The micro-macro paradox has been revived. Despite broadly positive evaluations at the micro- and meso-levels, recent literature doubts the ability of foreign aid to foster economic growth and development. This paper assesses the aid-growth literature and, taking inspiration from the program evaluation literature, we re-examine key hypotheses. In our findings, aid has a positive and statistically significant causal effect on growth over the long run, with confidence intervals conforming to levels suggested by growth theory. Aid remains a key tool for enhancing the development prospects of poor countries.

Original language	English
Journal	Journal of Globalization and Development
Volume	1
Issue number	2
Pages (from-to)	Article 5
Number of pages	27
DOIs	https://doi.org/10.2202/1948-1837.1121
Publication status	Published - 2010

Keywords

Faculty of Social Sciences

Access to Document

10.2202/1948-1837.1121

Cite this

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title = "Aid, growth, and development: Have we come full circle?",

abstract = "The micro-macro paradox has been revived. Despite broadly positive evaluations at the micro- and meso-levels, recent literature doubts the ability of foreign aid to foster economic growth and development. This paper assesses the aid-growth literature and, taking inspiration from the program evaluation literature, we re-examine key hypotheses. In our findings, aid has a positive and statistically significant causal effect on growth over the long run, with confidence intervals conforming to levels suggested by growth theory. Aid remains a key tool for enhancing the development prospects of poor countries. ",

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AU - Tarp, Finn

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AB - The micro-macro paradox has been revived. Despite broadly positive evaluations at the micro- and meso-levels, recent literature doubts the ability of foreign aid to foster economic growth and development. This paper assesses the aid-growth literature and, taking inspiration from the program evaluation literature, we re-examine key hypotheses. In our findings, aid has a positive and statistically significant causal effect on growth over the long run, with confidence intervals conforming to levels suggested by growth theory. Aid remains a key tool for enhancing the development prospects of poor countries.

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