The micro-macro paradox has been revived. Despite broadly positive evaluations at the micro- and meso-levels, recent literature doubts the ability of foreign aid to foster economic growth and development. This paper assesses the aid-growth literature and, taking inspiration from the program evaluation literature, we re-examine key hypotheses. In our findings, aid has a positive and statistically significant causal effect on growth over the long run, with confidence intervals conforming to levels suggested by growth theory. Aid remains a key tool for enhancing the development prospects of poor countries.

Ed. by Ocampo, José Antonio / Rodrik, Dani / Stiglitz, Joseph / Emran, M. Shahe
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Aid, Growth, and Development: Have We Come Full Circle?
Channing Arndt / Sam Jones / Finn Tarp
1University of Copenhagen
1University of Copenhagen
1University of Copenhagen and UNU-WIDER
Citation Information: Journal of Globalization and Development. Volume 1, Issue 2, Pages –, ISSN (Online) 1948-1837, DOI: 10.2202/1948-1837.1121, December 2010
Publication History:
- Published Online:
- 2010-12-27
Keywords: foreign aid; growth; aid effectiveness; causal effects


















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