Who Gives Foreign Aid to Whom and Why? / Alberto Alesina, David Dollar.

Format:

Book

Author/Creator:

Alesina, Alberto.

Contributor:

National Bureau of Economic Research.

Dollar, David.

Series:

Working Paper Series (National Bureau of Economic Research) no. w6612.

NBER working paper series no. w6612

Language:

English

Subjects (All):

Investments, Foreign--United States.

Investments, Foreign.

Economic assistance--Political aspects.

Economic assistance.

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1998.

Cambridge, Massachusetts : National Bureau of Economic Research, 1998.

Summary:

This paper studies the pattern of allocation of foreign aid from various donors to receiving countries. We find considerable evidence that the direction of foreign aid is dictated by political and strategic considerations, much more than by the economic needs and policy performance of the recipients. Colonial past and political alliances are the major determinants of foreign aid. At the margin, however, countries that democratize receive more aid, ceteris paribus. While foreign aid flows respond more to political variables, foreign direct investments are more sensitive to economic incentives, particularly property rights in the receiving countries. We also uncover significant differences in the behavior of different donors.

Notes:

Print version record

June 1998.