15 results on '"Tarp, Finn"'
Search Results
2. Does foreign aid harm political institutions?
- Author
-
Jones, Sam and Tarp, Finn
- Subjects
governance ,ddc:330 ,O17 ,institutions ,O19 ,foreign aid ,F35 ,government quality - Abstract
The notion that foreign aid harms the institutions of recipient governments remains prevalent. We combine new disaggregated aid data and various metrics of political institutions to re-examine this relationship. Long-run cross-section and alternative dynamic panel estimators show a small positive net effect of total aid on political institutions. Distinguishing between types of aid according to their frequency domain and stated objectives, we find this aggregate net effect is driven primarily by the positive contribution of more stable inflows of 'governance aid'. We conclude the data do not support the view that aid has had a systematic negative effect on political institutions.
- Published
- 2015
3. Aid Impact and Effectiveness: Introduction and Overview.
- Author
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Gisselquist, Rachel M. and Tarp, Finn
- Subjects
CLIMATE change ,INTERNATIONAL economic assistance - Abstract
This editorial provides an introduction to and overview of the thematic issue on "Aid Impact and Effectiveness". The guest editors put the specific contributions of the nine articles in perspective referring to the wider literature on foreign aid and its allocation, impact, and efficiency, as well as the political and economic processes in which aid operates. They discuss the historical and present-day context for foreign aid and provide summaries of the individual articles, highlighting policy implications and future research needs. [ABSTRACT FROM AUTHOR]
- Published
- 2019
- Full Text
- View/download PDF
4. What is the aggregate economic rate of return to foreign aid?
- Author
-
Arndt, Channing, Jones, Sam, and Tarp, Finn
- Subjects
C63 ,ddc:330 ,foreign aid ,F35 ,O4 ,heterogeneity ,simulation ,rate of return - Abstract
Does foreign aid promote aggregate economic growth? In contrast to widespread perceptions, academic studies of this question have been rapidly converging towards a positive answer. We employ a simulation approach to (i) validate the coherence of recent empirics and (ii) calculate plausible ranges for the rate of return to aid. Our results highlight the long-run nature of aid investments and indicate the return to aid falls in ranges commonly accepted for public investments. We find no basis for the view that aid has a pernicious effect on productivity.
- Published
- 2014
5. Assessing foreign aid's long-run contribution to growth in development
- Author
-
Arndt, Channing, Jones, Sam, and Tarp, Finn
- Subjects
growth ,ddc:330 ,O2 ,foreign aid ,O4 ,simultaneous equations ,aid effectiveness ,O1 ,C23 - Abstract
This paper confirms recent evidence of a positive impact of aid on growth and widens the scope of evaluation to a range of outcomes including proximate sources of growth (e.g., physical and human capital), indicators of social welfare (e.g., poverty and infant mortality), and measures of economic transformation (e.g., share of agriculture and industry in value added). Focusing on long-run cumulative effects of aid in developing countries, and taking due account of potential endogeneity, a coherent and favorable pattern of results emerges. Aid has over the past forty years stimulated growth, promoted structural change, improved social indicators and reduced poverty.
- Published
- 2013
6. Aid and income: Another time-series perspective
- Author
-
Lof, Matthijs, Mekasha, Tseday Jemaneh, and Tarp, Finn
- Subjects
O11 ,C51 ,growth ,VAR models ,ddc:330 ,foreign aid ,F35 ,time series ,C23 - Abstract
In a recent article, Nowak-Lehmann, Dreher, Herzer, Klasen, and Martínez-Zarzoso (2012) (henceforth NDHKM) conclude that foreign aid has not had a significant effect on income, based on evidence from panel data potentially covering 131 countries over the period 1960-2006. The present study provides a replication of the empirical results reported by NDHKM. We uncover that NDHKM relied on a regression model that included a log transformation of variables that are not strictly positive. This led to a non-random omission of a large proportion of observations. Furthermore, we show that NDHKM's use of co-integrated regressions is not a suitable empirical strategy for estimating the causal effect of aid on income. Given the nature of the variables and the question under investigation, a Vector Autoregressive (VAR) model can arguably better address the inherent endogeneity problem in the aid-growth relationship. Evidence from a panel VAR model estimated on the dataset of NDHKM, suggests a positive and statistically significant long-run effect of aid on income.
- Published
- 2013
7. The long-run impact of foreign aid in 36 African countries: Insights from multivariate time series analysis
- Author
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Juselius, Katarina, Framroze Møller, Niels, and Tarp, Finn
- Subjects
transmission channels ,O11 ,Africa ,Cointegrated VAR ,ddc:330 ,unit roots ,Zeitreihenanalyse ,Multivariate Analyse ,foreign aid ,Entwicklungshilfe ,F35 ,C32 ,Afrika - Abstract
Studies of aid effectiveness abound in the literature, often with opposing conclusions. Since most time-series studies use data from the exact same publicly available data bases, our claim here is that such differences in results must be due to the use of different econometric models and methods. To investigate this we perform a comprehensive study of the long-run effect of foreign aid (ODA) on a set of key macroeconomic variables in 36 sub-Saharan African countries from mid-1960s to 2007. We use a well-specified (Cointegrated) VAR (CVAR) model as our statistical benchmark. It represents a much-needed general-to-specific approach which can provide broad confidence intervals within which empirically relevant claims should fall. Based on stringent statistical testing, our results provide broad support for a positive long-run impact of ODA flows on the macroeconomy. For example, we find a positive effect of ODA on investment in 33 of the 36 included countries, but hardly any evidence supporting the view that aid has been harmful. From a methodological point of view our study documents the importance of transparency in results reporting in particular when the statistical null does not correspond to a natural economic null hypothesis. Our study identifies three reasons for econometrically unsatisfactory results in the literature: failure to adequately account for unit roots and breaks; imposing seemingly innocuous but invalid data transformations; and imposing aid endogeneity/exogeneity without testing.
- Published
- 2011
8. Aid effectiveness: Opening the black box
- Author
-
Arndt, Channing, Jones, Sam, and Tarp, Finn
- Subjects
Wirtschaftswachstum ,growth ,ddc:330 ,O2 ,foreign aid ,Entwicklungshilfe ,O4 ,simultaneous equations ,aid effectiveness ,O1 ,C23 - Abstract
Controversy over the aggregate impact of foreign aid has focused on reduced form estimates of the aid-growth link. The causal chain, through which aid affects developmental outcomes including growth, has received much less attention. We address this gap by: (i) specifying a structural model of the main relationships; (ii) estimating the impact of aid on a range of final and intermediate outcomes; and (iii) quantifying a simplied representation of the full structural form, where aid impacts on growth through key intermediate outcomes. A coherent picture emerges: aid stimulates growth and reduces poverty through physical capital investment and improvements in health.
- Published
- 2011
9. Aid and Growth:Have We Come Full Circle?
- Author
-
Arndt, Channing, Jones, Sam, and Tarp, Finn
- Subjects
causal effects ,Wirtschaftswachstum ,growth ,Entwicklungshilfe ,foreign aid ,O4 ,Wachstumstheorie ,Faculty of Social Sciences ,O1 ,ddc:330 ,Kausalanalyse ,Entwicklungsländer ,F35 ,aid effectiveness ,C21 - Abstract
The micro-macro paradox has been revived. Despite broadly positive evaluations at the micro and meso-levels, recent literature has turned decidedly pessimistic with respect to the ability of foreign aid to foster economic growth. Policy implications, such as the complete cessation of aid to Africa, are being drawn on the basis of fragile evidence. This paper first assesses the aid-growth literature with a focus on recent contributions. The aid-growth literature is then framed, for the first time, in terms of the Rubin Causal Model, applied at the macroeconomic level. Our results show that aid has a positive and statistically significant causal effect on growth over the long run with point estimates at levels suggested by growth theory. We conclude that aid remains an important tool for enhancing the development prospects of poor nations.
- Published
- 2009
10. Aid and Development:The Mozambican Case
- Author
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Tarp, Finn, Arndt, Channing, and Jones, Edward Samuel
- Subjects
foreign aid ,Faculty of Social Sciences ,development ,Mozambique - Abstract
This paper considers the relationship between external aid and development in Mozambique from 1980 to 2004. The main objective is to identify the specific mechanisms through which aid has influenced the developmental trajectory of the country and whether one can plausibly link outcomes to aid inputs. We take as our point of departure a growth accounting analysis and review both intended and unintended effects of aid. Mozambique has benefited from sustained aid inflows in conflict, post-conflict and reconstruction periods. In each of these phases aid has made an unambiguous, positive contribution both enabling and supporting rapid growth since 1992. At the same time, the proliferation of donors and aid-supported interventions has burdened local administration and there is a distinct need to develop government accountability to its own citizens rather than donor agencies. In ensuring sustained future growth, Mozambique will have to develop its capacity to maximise the benefits from its natural resources while ensuring at the same time the necessary framework is put in place to promote constructive integration in international markets
- Published
- 2006
11. Aid and Development
- Author
-
Tarp, Finn
- Subjects
foreign aid ,aid impact ,Faculty of Social Sciences - Abstract
Foreign aid looms large in the public discourse; and international development assistance remains squarely on most policy agendas concerned with growth, poverty and inequality in Africa and elsewhere in the developing world. The present review takes a retrospective look at how foreign aid has evolved since World War II in response to a dramatically changing global political and economic context. I review the aid process and associated trends in the volume and distribution of aid and categorize some of the key goals, principles and institutions of the aid system. The evidence on whether aid has been effective in furthering economic growth and development is discussed in some detail. I add perspective and identify some critical unresolved issues. I finally turn to the current development debate and discuss some key concerns, which I believe should be kept in mind in formulating any agenda for aid in the future
- Published
- 2006
12. Aid Policy and the Macroeconomic Management of Aid.
- Author
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Addison, Tony and Tarp, Finn
- Subjects
- *
INTERNATIONAL economic assistance , *MACROECONOMICS , *SUPPLY-side economics - Abstract
Summary 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–growth relationship; the supply-side of aid (including its level, volatility, and coordination of donors); and the macroeconomic framework around aid. The studies in the special issue demonstrate the centrality of research methodology, the importance of disaggregation, and the need to account for country-specific situations and problems. This introduction concludes that the sometimes “over heated” debate on aid needs redirecting toward more rigorous analysis, in which the advantages—and disadvantages—of using aid for development can be evaluated in a calmer manner. [ABSTRACT FROM AUTHOR]
- Published
- 2015
- Full Text
- View/download PDF
13. Aid and Income: Another Time-series Perspective.
- Author
-
Lof, Matthijs, Mekasha, Tseday Jemaneh, and Tarp, Finn
- Subjects
- *
INTERNATIONAL economic assistance , *TIME series analysis , *INCOME , *EMPIRICAL research , *REGRESSION analysis , *CAUSAL models , *VECTOR autoregression model , *LONG run (Economics) - Abstract
Summary This study provides a replication of the empirical results reported by Nowak-Lehmann, Dreher, Herzer, Klasen, and Martínez-Zarzoso (2012) (henceforth NDHKM). We uncover that NDHKM relied on a regression model which included a log transformation of variables that are not strictly positive. This led to nonrandom omission of a large proportion of observations. Furthermore, we show that NDHKM’s use of co-integrated regressions is not a suitable empirical strategy for estimating the causal effect of aid on income. Evidence from a Panel VAR model estimated on the dataset of NDHKM, suggests a positive and statistically significant long-run effect of aid on income. [ABSTRACT FROM AUTHOR]
- Published
- 2015
- Full Text
- View/download PDF
14. Assessing Foreign Aid’s Long-Run Contribution to Growth and Development.
- Author
-
Arndt, Channing, Jones, Sam, and Tarp, Finn
- Subjects
- *
INTERNATIONAL economic assistance , *ECONOMIC development , *LONG run (Economics) , *HUMAN capital , *PUBLIC welfare , *ECONOMIC change , *ENDOGENEITY (Econometrics) , *SOCIAL indicators - Abstract
Summary This paper confirms recent evidence of a positive impact of aid on growth and widens the scope of evaluation to a range of outcomes including proximate sources of growth (e.g., physical and human capital), indicators of social welfare (e.g., poverty and infant mortality), and measures of economic transformation (e.g., share of agriculture and industry in value added). Focusing on long-run cumulative effects of aid in developing countries, and taking due account of potential endogeneity, a coherent and favorable pattern of results emerges. Aid has over the past 40 years stimulated growth, promoted structural change, improved social indicators, and reduced poverty. [ABSTRACT FROM AUTHOR]
- Published
- 2015
- Full Text
- View/download PDF
15. Rejoinder to Herzer, Nowak-Lehmann, Dreher, Klasen, and Martinez-Zarzoso (2014).
- Author
-
Lof, Matthijs, Mekasha, Tseday Jemaneh, and Tarp, Finn
- Published
- 2015
- Full Text
- View/download PDF
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