United States foreign assistance to Pakistan has always been driven by security considerations. By 2010, US counter-terrorism and stabilisation objectives resulted in Pakistan becoming the second largest recipient of US foreign aid globally. Given the policy impact of the assumption that aid promotes US security objectives in Pakistan, there is surprisingly little analysis or evidence of its ef...

Building on previous literature, we assess when foreign aid is effective in fighting terrorism using quantile regressions on a panel of 78 developing countries for the period 1984-2008. Bilteral, multilateral and total aid indicators are used whereas terrorism includes: domestic, transnational, unclear and total terrorism dynamics. We consistently establish that foreign aid (bilateral, multilat...

Rapid urbanization, and particularly the associated problems of urban poverty, unsustainable development and environmental degradation, pose an enormous challenge to many developing countries. In the last decade more foreign aid has been diverted to urbanization and green city development. This paper studies aid’s implementation strategies and effectiveness by investigating ‘what works in forei...

We study the importance of the local elite as a determinant of the e¤ectiveness of foreign aid in developing countries. An "extractive" elite will misuse aid ‡ows, an issue that is probably as old as foreign aid itself. We proxy for the existence of an "extractive" elite by using an historically determined variable: the percentage of European settlers in colonial times. Our econometric results ...

In this paper I discuss the effectiveness of foreign aid from a historical perspective. I show that foreign aid is a relatively new concept in economics, and I emphasize the role of exchange rate policies in the foreign aid controversies of the 1970s through 1990s. I show that in the early 1980s there were major changes in views regarding aid and agriculture. I emphasize the role of “ownership”...

This paper considers the impact of foreign aid for HIV on the number of new infections in low middle income countries . We provide causal estimates by improving on earlier studies by addressing the endogeneity of aid disbursements through the use of instrumental variables. In addition, we effectively control for unobserved country specific effects that might jointly influence aid allocation and...