[DOWNLOAD] "Aid, Policies, And Growth: Bauer was Right (Peter Bauer; Economics of Developing Countries)" by The Cato Journal " Book PDF Kindle ePub Free
eBook details
- Title: Aid, Policies, And Growth: Bauer was Right (Peter Bauer; Economics of Developing Countries)
- Author : The Cato Journal
- Release Date : January 22, 2003
- Genre: Politics & Current Events,Books,
- Pages : * pages
- Size : 251 KB
Description
The late Peter Bauer was a giant in development economics. By the end of his life he had convinced many in the economics profession that it is simply untrue that developing countries can break out of the poverty trap only by receiving foreign aid from the more prosperous industrial nations. In fact, Bauer (2000: 46) went one step further: Although Bauer's influence has been powerful, it has not been pervasive. There appear to be some in the economic development community on whom his message seems not to have made even a dent. A case in point is the much-acclaimed study by two World Bank economists, Craig Burnside and David Dollar (2000, henceforth BD). Relying on a panel data set of 56 countries over six 4-year periods (beginning with 1970-73 and ending with 1990-93), the authors use regression analysis techniques to examine the relationship between national economic growth, national economic policy, and foreign aid received. More precisely, they regress the growth rate of real GDP per capita on various combinations of regressors, with the basic specification including an index of the quality of national economic policy, a measure of foreign aid, and an aid-policy interaction term. Their two principal findings are (1) the estimated coefficient of aid is negative but not statistically significant, and (2) the estimated coefficient of the aid-policy interaction term is positive and significantly different from zero. From these two results, BD (2000: 847) conclude: "We find that aid has a positive impact on growth in developing countries with good fiscal, monetary, and trade policies, but has little effect in the presence of poor policies." William Easterly (2003: 24) reports that BD's study has been extraordinarily influential: "Their general finding was passed on from one media report to another and was cited by international agencies advocating an increase in foreign aid."