Size Matters: The Impact of Aid on Institutions

Tanya Bowman and Satish Chand

No RP2007-25, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: This paper proposes that aid flowing to smaller (less populous) countries has a negative impact on the quality of institutions in terms of performance and policy as opposed to that flowing to larger countries, where evidence suggests that the impacts are positive. The analysis here suggests that the level of development, the size of an economy, and the level of aid receipts matter for institutional performance as quantified by measures of economic freedom.

Keywords: Economic assistance and foreign aid; Economic development; Economic policy; Macroeconomics (search for similar items in EconPapers)
Date: 2007
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Citations: View citations in EconPapers (5)

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