Hysteresis, aid, and governance: theories and empirics from Africa

Célestin Monga and Bouba Housseini

Chapter 6 in Handbook of Aid and Development, 2024, pp 77-109 from Edward Elgar Publishing

Abstract: Foreign aid is, in principle, inexpensive finance that savings-constrained developing countries can use to support productive investment, signal good macroeconomic management, and attract private capital. Many studies have been devoted to its impact and the methodological challenges and assumptions for measuring it. But whether aid is empirically found to be effective or not may not matter to countries relying on aid as a permanent source of financing. Although aid has brought substantial volumes of foreign savings into Africa, its open-ended time-horizon and politicized motivations have also caused excessive dependency on foreign assistance. This chapter examines the changing nature of aid and development in Africa and analyzes the role of hysteresis in the continent’s persistent need for foreign aid since the 1970s. Long-term aid patterns to Africa show evidence of “addiction” - defined as reliance on aid to the point where the economic, social, and political costs outweigh the potential benefits.

Keywords: Development Studies; Geography; Politics and Public Policy Sociology and Social Policy (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.elgaronline.com/doi/10.4337/9781800886810.00012 (application/pdf)
Our link check indicates that this URL is bad, the error code is: 503 Service Temporarily Unavailable

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:elg:eechap:20736_6

Ordering information: This item can be ordered from
http://www.e-elgar.com

Access Statistics for this chapter

More chapters in Chapters from Edward Elgar Publishing
Bibliographic data for series maintained by Darrel McCalla ().