The Relationship Between Foreign Aid and Economic Growth: Empirical Evidence from Bangladesh

2021 ◽  
Author(s):  
Uttam Golder
Keyword(s):  
Economic Growth ◽  
Foreign Aid ◽  
Empirical Evidence ◽  
The Relationship

scholarly journals Can One Promote a Delegation of the Bilateral Aid to Multilateral Donors to Improve Foreign Aid Effect on Economic Growth in ECOWAS (Note 1) Countries?

2019 ◽  
Vol 2 (1) ◽  
pp. 51
Author(s):  
W. Jean Marie Kébré
Keyword(s):  
Economic Growth ◽  
Panel Data ◽  
Least Squares ◽  
Foreign Aid ◽  
Bilateral Aid ◽  
Multilateral Aid ◽  
Multilateral Institutions ◽  
Negative Effect ◽  
High Degree ◽  
The Relationship

<p><em>This article analyzes the relationship between external aid and economic growth in the ECOWAS region, with a focus on bilateral and multilateral aid effects. The key idea behind this analysis is an argument of Svensson</em><em> </em><em>(2000)</em><em> that multilateral aid is more effective than bilateral aid because of the high degree of altruism of bilateral donors. He therefore suggested a delegation of bilateral aid to multilateral institutions. To appreciate his suggestion, this analysis used panel data from the 16 ECOWAS countries from the period 1984 to 2014. The results of the estimates, based on the dynamic least squares estimator (DOLS), show a negative effect of foreign aid on economic growth. This negative effect on economic growth persists when the components of aid are introduced into the model. In addition, results highlight that governance is a channel through which foreign aid affect positively economic growth. In these conditions, bilateral aid is more effective on economic growth than multilateral aid. These results about foreign aid received by ECOWAS countries invalidates</em><em> </em><em>Svensson’s</em><em> </em><em>(</em><a title="Svensson, 2000 #5" href="#_ENREF_1"><em>2000</em></a><em>)</em><em> theory. Therefore, a delegation of bilateral aid to multilateral institutions is not relevant because bilateral aid contributes more to economic growth if governance is taken into account.</em></p>

scholarly journals The Impact of Public Expenditure on Economic Growth: A Review of International Literature

2019 ◽  
Vol 19 (2) ◽  
pp. 81-101
Author(s):  
Sheilla Nyasha ◽  
Nicholas M. Odhiambo
Keyword(s):  
Economic Growth ◽  
Empirical Evidence ◽  
Government Spending ◽  
Public Expenditure ◽  
Negative Impact ◽  
Positive Impact ◽  
Government Expenditure ◽  
Empirical Literature ◽  
The Impact ◽  
The Relationship

Abstract Research background: Although a number of studies have been conducted on the relationship between public expenditure and economic growth, it is difficult to tell with certainty whether or not an increase in public expenditure is good for economic growth. This lack of consensus on the results of the previous empirical findings makes this study of paramount importance as we take stock of the available empirical evidence from the 1980s to date. Purpose: In this paper, theoretical and empirical literature on the relationship between government expenditure and economic growth has been reviewed in detail. Focus was placed on the review of literature that assessed the impact of government spending on economic growth. Research Methodology: This study grouped studies on the impact of public expenditure on economic growth based on their results. Three groups emerged – positive impact, negative impact and no impact. This was followed by a review of each relevant study and an evaluation of which outcome was more prevalent among the existing studies on the subject. Results: The literature reviewed has shown that the impact of government spending on economic growth is not clear cut. It varies from positive to negative; with some studies even finding no impact. Although the impact of government spending on economic growth was found to be inconclusive, the scale tilts towards a positive impact. Novelty: The study provides an insight into the relationship between public expenditure and economic growth based on a comprehensive review of previous empirical evidence across various countries since the 1980s.

scholarly journals The Impact of Foreign Aid on Economic Growth in Palestine: An Empirical Evidence

2021 ◽  
pp. 99-114
Author(s):  
Nemer Badwan ◽  
Mohammed Atta
Keyword(s):  
Economic Growth ◽  
Foreign Aid ◽  
Labour Force ◽  
High Rate ◽  
Series Data ◽  
Special Focus ◽  
Chow Test ◽  
Palestinian Economy ◽  
The Impact ◽  
The Relationship

This study examines the Impact of Foreign Aid on Economic Growth in Palestine by considering time series data of the last twenty years from (2000-2019). Foreign Aid's Impact on the Palestinian Economy explored with the Gross Domestic Product (GDP) as the dependent variable against few selected independent variables such as Foreign Aid, Remittance, Investment, Labour Force and Lagged (GDP). This study used the Partial Adjustment Model to analyze the Impact of Foreign Aid on Economic Growth in Palestine and also applied the (Chow Test) to examine whether there was a Structural Breakthrough in the Palestinian Economy. The results indicate that Foreign Aid has a positive relationship with (GDP). However, the relationship is not significant since the higher volume of Foreign Aid used in Humanitarian and Social Welfare rather than Production Activities in the real sectors. (Chow Test) shows that the relationship between Foreign Aid (GDP) has not witnessed a Structural Breakthrough in the Palestinian Economy over the past twenty years. In light of these empirical results, we suggest that Government Policy-Makers and Decision-Makers allocate this Foreign Aid to Productive Sectors and Human Capital formation (HC) activities with a special focus on capital expenditures to achieve a high rate of the country's Economic Growth and Development and to meet the periodic plan and Long-Term Development goals.

scholarly journals RELATIONSHIP BETWEEN POLLUTION AND ECONOMIC GROWTH IN CHINA: EMPIRICAL EVIDENCE FROM 111 CITIES

2015 ◽  
Vol 9 (1) ◽  
pp. 22-31 ◽  
Author(s):  
Haitao Zheng ◽  
Wenxin Huai ◽  
Lele Huang
Keyword(s):  
Economic Growth ◽  
Environmental Pollution ◽  
Environmental Protection ◽  
Empirical Evidence ◽  
Scale Effect ◽  
Composition Effect ◽  
Planning Project ◽  
Environmental Development ◽  
Economic Relationship ◽  
The Relationship

Steady economic growth and environmental protection are two contradictory goals of top priorities in China 2016–2020 Planning Project. Cities play important role in economic and environmental development. The research on cities’ economic-pollution relationship is vital to the choices in city developing patterns. This paper investigates the relationship between economic growth and environmental pollution of 111 Chinese prefectural-level cities in the period 2004–2012 and how it might influence the choice of a city's developing pattern. These 111 cities are classified to five different clusters, one of which has particular pollution-economic relationship and some of which coordinate the EKC theory. The paper suggests that city features, scale effect and composition effect are important in the distribution of cities’ developing patterns.

scholarly journals Foreign Aid, Domestic Savings and Economic Growth (Pakistan: 1960 to 1988)

1993 ◽  
Vol 32 (4II) ◽  
pp. 1157-1167 ◽  
Author(s):  
Naheed Zia Khan ◽  
Eric Rahim
Keyword(s):  
Economic Growth ◽  
Foreign Aid ◽  
Negative Relationship ◽  
Causal Chain ◽  
Domestic Investment ◽  
Quantitative Evidence ◽  
Explanatory Variables ◽  
Savings Rate ◽  
Domestic Savings ◽  
The Relationship

One of the core tenets of foreign aid theory, particularly as encapsulated in the two-gap model, is that the insertion of foreign resources via free grants, loans, direct investment etc., into a developing economy sets in motion a causal chain of positive influences in the following broad mannerl: aid' ~ increase in investible resources ~ increase in domestic investment ~ more rapid rate of economic growth. Spirited and specific challenges to this approach came from many critics, supported greatly by a number of broad theoreticaF and empirical analyses. For a large part of the latter, the available evidence pointed to a negative relationship between aid and domestic savings. The evidence was largely based on crosssectional data, 'showing that, there was, in addition, reason to suggest a negative relationship between aid and economic growth. 3 The aim of this study is to provide some quantitative evidence on the relationship between foreign aid, domestic savings and economic growth for Pakistan. The analysis is carried out in three parts. Part one contains the methodology and the description of the data. Part two explores the correlation between aid and several other explanatory variables with Pakistan's savings rate, while part three attempts to analyse and explain the regression findings in terms of the effect of aid on economic growth.

An Econometric Analysis of the Links Between Income Inequality and Economic Growth

2009 ◽  
pp. 130
Author(s):  
Yohannes G. Hailu ◽  
Tesfa G. Gebremedhin ◽  
Randall W. Jackson
Keyword(s):  
Economic Growth ◽  
Income Inequality ◽  
Empirical Evidence ◽  
Growth Model ◽  
Capita Income ◽  
Regional Growth ◽  
County Level ◽  
Income Inequalities ◽  
Per Capita ◽  
The Relationship

This study investigates temporal demographic changes and income inequalities, and more importantly the relationship between income inequality and economic growth inWest Virginia. Departing from earlier studies, a regional growth model is utilized and empirically tested using county level West Virginia data (1990-2000). Results suggest that per-capita income change is positively related to population and employment changes but negatively related to income inequality. This empirical evidence indicates that higher income inequality can potentially hinder economic growth.

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