We construct an endogenous growth model and we employ empirical analysis to investigate the link between foreign aid and production inefficiency in the presence of different political orientations in the recipient country. Using a panel of 124 countries from 1971 to 2007 and the production frontier toolbox, controlling for unobserved heterogeneity, time horizons, the sources of aid, and the tim...

Relying on a simple endogenous growth model, this paper highlights a political instability effect as a potential explanation for why foreign aid is frequently ineffective with respect to economic performance. In the present framework, the role of the state is to fund institutions allowing for ongoing technology adoption and hence long-run growth. However, providing a self-interested government ...

BACKGROUND Rural healthcare facilities in low-income countries play a major role in providing primary care to rural populations. We examined the link of foreign aid with government investments and medical service provision in rural health centres in Rwanda. METHODS Using the District Health System Strengthening Tool, a web-based database built by the Ministry of Health in Rwanda, we construct...

Although there appears to be no Australian foreign policy statement on health, much of our existing foreign policy has health implications, ranging across security, economic, political and humanitarian objectives. Humanitarian motives have influenced Australia's foreign-aid policy, but our aid program, like our wider foreign policy, has a large national interest component. A generalised approac...

This paper investigates the link between foreign aid and exports between the two shores of the Mediterranean. The main hypothesis is that the Euro-Mediterranean Process should promote not only trade but also stronger links between the European Union (EU) and the Middle East and North Africa (MENA). Hence, we expect development aid to have a positive impact on exports, which could also intensify...

Over the past two decades, donors increasingly linked foreign aid to democracy objectives in sub-Saharan Africa. Yet systematic research on this topic typically focuses on how aid influences democratic transitions. This study investigates whether and how foreign aid affects the process of democratic consolidation in sub-Saharan Africa by examining two potential mechanisms: (1) the use of aid as...

This paper examines the link between foreign aid and the composition of government spending in aid-recipient countries. Two questions are addressed: (i) does foreign aid crowd out government spending in aid-recipient countries, and (ii) does the degree of fungibility vary across different categories of aid? Using a panel dataset of 67 countries for 1972-2000 we find that at the aggregate level ...