Title : Foreign Aid and Economic Growth in Philippines


Authors : Rajarshi Mitra, and Md. Sharif Hossain

Abstract : With recent studies generating skepticism toward aid-effectiveness for economic growth of some aid-dependent economies, the need to re-examine the effectiveness of foreign aid for economic growth has gained increasing importance. This paper examines the role of foreign aid in per-capita economic growth in the Philippines, a country that has historically been one of the largest recipients of foreign aid. A VECM is estimated for the period 1970-2010. Results indicate a significantly negative relationship between foreign aid and per-capita economic growth. A 1% rise in the share of aid in GDP results in a fall in per-capita real income by 0.51%.


Journal : Economics Bulletin Volume : 33 Year : July, 2013 Issue : 3
Pages : 1706-1714 City : Edition : Editors :
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