title: Geopolitics, Aid and Growth
creator: Dreher, Axel 
creator: Eichenauer, Vera 
creator: Gehring, Kai 
subject: 330
subject: 330 Economics
description: We investigate the effects of short-term political motivations on the effectiveness of foreign aid. Specifically, we test whether the effect of aid on economic growth is reduced by the share of years a country has served on the United Nations Security Council (UNSC) in the period the aid has been committed, which provides quasi-random variation in aid. Our results show that the relationship of aid with growth is significantly lower when aid has been committed during a country’s tenure on the UNSC. We derive two conclusions from this. First, short-term political favoritism reduces growth. Second, political interest variables are inadequate as instruments for overall aid, raising doubts about a large number of results in the aid effectiveness literature. 
date: 2014-10
type: Working paper
type: info:eu-repo/semantics/workingPaper
type: NonPeerReviewed
format: application/pdf
identifier: https://archiv.ub.uni-heidelberg.de/volltextserverhttps://archiv.ub.uni-heidelberg.de/volltextserver/17545/1/Dreher_Eichenauer_Gehring_2014_dp575-1.pdf
identifier: DOI:10.11588/heidok.00017545
identifier: urn:nbn:de:bsz:16-heidok-175459
identifier:   Dreher, Axel  ; Eichenauer, Vera  ; Gehring, Kai   (2014) Geopolitics, Aid and Growth.  [Working paper]     
relation: https://archiv.ub.uni-heidelberg.de/volltextserver/17545/
rights: info:eu-repo/semantics/openAccess
rights: http://archiv.ub.uni-heidelberg.de/volltextserver/help/license_urhg.html
language: eng