Aid, Export Promotion and the Real Exchange Rate: An African Dilemma?

Sweder van Wijnbergen

No 88, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: Africa, while a major aid recipient, has had disappointing export performance. This paper argues for a causal link: aid, by being partially spent on non-traded goods, leads to real appreciation and reduced export competitiveness. I demonstrate the importance of this effect by presenting econometric evidence on the positive relation between aid flows and real exchange rate appreciation and increases in the real wage in the traded-goods sector. Policy implications are discussed.

Keywords: Africa; Development Aid; Export Performance; Real Exchange Rate Appreciation; Traded and Non-Traded Goods (search for similar items in EconPapers)
Date: 1985-12
References: Add references at CitEc
Citations: View citations in EconPapers (32)

Downloads: (external link)
http://www.cepr.org/active/publications/discussion_papers/dp.php?dpno=88 (application/pdf)

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:cpr:ceprdp:88

Ordering information: This working paper can be ordered from
http://www.cepr.org/ ... apers/dp.php?dpno=88

Access Statistics for this paper

More papers in CEPR Discussion Papers from Centre for Economic Policy Research 33 Great Sutton Street, London EC1V 0DX, UK.
Bibliographic data for series maintained by CEPR ().