Do institutions and social cohesion enhance the effectiveness of aid? New Evidence from Africa

Mina Baliamoune

ICER Working Papers from ICER - International Centre for Economic Research

Abstract: Using the Arellano-Bond dynamic panel GMM estimator, this paper explores the effects of aid, institutions, and social cohesion on per-capita income growth in 34 African countries, focusing in particular on the interplay of aid and institutions and the interplay of aid and social cohesion. The empirical results indicate that social cohesion enhances the growth effects of aid but there is a threshold effect, suggesting that aid becomes effective in enhancing growth in countries with higher social cohesion. Surprisingly, the results show that beyond a certain level of improvements in institutional quality, institutions (political rights and civil liberties) reduce the effectiveness of aid. We discuss the implications of these results.

Keywords: Growth; aid effectiveness; institutions; social cohesion; Africa (search for similar items in EconPapers)
JEL-codes: F35 F43 O17 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2011-09
New Economics Papers: this item is included in nep-afr, nep-dev, nep-pol and nep-soc
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: DO INSTITUTIONS AND SOCIAL COHESION ENHANCE THE EFFECTIVENESS OF AID? NEW EVIDENCE FROM AFRICA (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:icr:wpicer:13-2011

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