Aid and Government Fiscal Behavior: Assessing Recent Evidence

Oliver Morrissey

World Development, 2015, vol. 69, issue C, 98-105

Abstract: This paper reviews evidence published in the last 10years that has added to our understanding of the effects of aid on government spending and tax effort in recipient countries, with a discussion of when (general) budget support is a fiscally efficient aid modality. Three generalizations are permitted by the evidence: aid finances government spending; the extent to which aid is fungible is over-stated and even where it is fungible this does not appear to make the aid less effective; and there is no systematic effect of aid on tax effort. Beyond these conclusions effects are country-specific.

Keywords: aid (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (60)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:wdevel:v:69:y:2015:i:c:p:98-105

DOI: 10.1016/j.worlddev.2013.12.008

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