nep-afr New Economics Papers
on Africa
Issue of 2005‒11‒12
three papers chosen by
Suzanne McCoskey
Foreign Service Institute, US Department of State

  1. The Impact of Foreign Aid on Economic Growth: Volatility of Disbursements and Distribution of Receipts By K C Neanidis; D Varvarigos
  2. Paths to Success: The Relationship Between Human Development and Economic Growth By Michael Boozer; Gustav Ranis; Frances Stewart; Tavneet Suri
  3. Trade Globalization and Political Liberalization: A Gravity Approach By Miaojie YU

  1. By: K C Neanidis; D Varvarigos
    Abstract: This paper is concerned with the effects of aid transfers and their degree of volatility on economic growth. We develop a theoretical framework that distinguishes the allocation of foreign aid between productive and nonproductive uses. On the one hand, devoting aid inflows into productive public spending promotes growth while the related volatility has a damaging effect. On the other hand, the non-productive use of aid transfers has an adverse effect on growth while their volatility is growth-enhancing. The theoretical implications are supported by an empirical specification, formulated on similar grounds, for a panel of 74 aid-recipient countries over the time period from 1972 to 1998. The empirical results are found to be robust in a variety of sensitivity tests.
    Date: 2005
  2. By: Michael Boozer (Economic Growth Center, Yale University); Gustav Ranis (Economic Growth Center, Yale University); Frances Stewart; Tavneet Suri
    Abstract: This paper explores the two-way relationships between Economic Growth (EG) and Human Development (HD), building on an earlier work by Ranis, Stewart, and Ramirez (2000). Here, we show that HD is not only a product of EG but also an important input to it. The paper develops new empirical strategies to estimate the strength of the two-way chains connecting HD and EG. Building on existing growth literature, we explore the empirical determinants of positive growth trajectories running from HD to EG and find that HD plays an essential role in explaining growth trajectories. Our findings point to the empirical relevance of endogenous growth models in general, and threshold effect models in particular. We also develop a measure of the strength of the EG to HD relationship and explore some of its empirical determinants. A strong sequencing implication of our findings is that HD must be given priority for the achievement of both higher EG as well as HD.
    Keywords: Human Development, Economic Growth, Threshold Models
    JEL: O15 O57 C23
    Date: 2003–12
  3. By: Miaojie YU (Department of Economics, UC-Daivs)
    Abstract: This paper is an empirical investigation on the relationship between trade globalization and political liberalization. The sample is based on 157 countries from years 1957-1998, taking into consideration many social, economic, environmental, geographical, and historical factors. From this, an augmented gravity equation is estimated and evidence is found to support the prediction that political liberalization could discourage trade and trade could foster democracy.
    Keywords: Trade, Democracy, Gravity Equation
    JEL: F13 F14 P16
    Date: 2005–11–09

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