The limits of official development assistance in fostering economic growth : a comparative analysis of western and Chinese economic cooperation practices in Africa

2014 ◽  
Author(s):  
Simone Raudino
2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Amna Zardoub ◽  
Faouzi Sboui

PurposeGlobalization occupies a central research activity and remains an increasingly controversial phenomenon in economics. This phenomenon corresponds to a subject that can be criticized through its impact on national economies. On the other hand, the world economy is evolving in a liberalized environment in which foreign direct investment plays a fundamental role in the economic development of each country. The advent of financial flows – FDI, remittances and official development assistance – can be a key factor in the development of the economy. The subject of this article is to analyses the effect of financial flows on economic growth in developing countries. Empirically, different approaches have been employed. As part of this work, an attempt was made to use a panel data approach. The results indicate ambiguous effects and confirm the results of previous work.Design/methodology/approachThe authors seek to study the effect of foreign direct investment, remittances and official development assistance (ODA) and some control variables i.e. domestic credit, life expectancy, gross fixed capital formation (GFCF), inflation and three institutional factors on economic growth in developing countries by adopting the panel data methodology. Then, the authors will discuss empirical tests to assess the econometric relevance of the model specification before presenting the analysis of the results and their interpretations that lead to economic policy implications. As part of this work, the authors have rolled panel data for developing countries at an annual frequency during the period from 1990 to 2016. In a first stage of empirical analysis, the authors will carry out a technical study of the heterogeneity test of the individual fixed effects of the countries. This kind of analysis makes it possible to identify the problems retained in the specific choice of econometric modeling to be undertaken in the specificities of the panel data.FindingsThe empirical results validate the hypotheses put forward and indicate the evidence of an ambiguous effect of financial flows on economic growth. The empirical findings from this analysis suggest the use of economic-type solutions to resolve some of the shortcomings encountered in terms of unexpected effects. Governments in these countries should improve the business environment by establishing a framework that further encourages domestic and foreign investment.Originality/valueIn this article, the authors adopt the panel data to study the links between financial flows and economic growth. The authors considered four groups of countries by income.


2018 ◽  
Vol 65 (01) ◽  
pp. 239-256
Author(s):  
SUNG-KO LI ◽  
CHUN-KEI TSANG

Many developing countries are receiving official development assistance (ODA). Whether ODA is beneficial or harmful to the receiving country is controversial in the literature. This paper analyzes this issue from a new angle by adopting the framework of competitiveness which allows us to link resource allocation with economic growth. Under this framework, we point out that the mechanism of resource allocation influences the effectiveness of ODA on economic growth. By applying data envelopment analysis (DEA) to competitiveness, we capture the effects of inefficient and biased allocation of resources on ODA. The data confirm the co-existence of positive and negative impacts of ODA. Finally, we conclude that current ODA is not efficient in helping most of the receiving countries.


2017 ◽  
Vol 9 (2) ◽  
pp. 159
Author(s):  
Wadad Saad

This study investigates empirically the determinants of economic growth and total factor productivity in Lebanon over the period 1980-2014. To do so, we firstly estimate the total factor productivity in a growth accounting framework. Secondly, an Autoregressive Distributed Lag (ARDL) modeling approach has been applied to examine the relationship between economic growth and some macroeconomic variables such as foreign direct investment, openness, claims on private sector, and official development assistance. Then we consider modeling the effects of these macroeconomic determinants on TFP through an ARDL model. Findings of the regression analysis suggest the presence of a statistically significant relationship between economic growth and the variables involved in this study except for claims on private sector which appears to be insignificant. The results of TFP model show a significant relationship with claims on private sector and openness on one hand and insignificant link with the direct foreign investment and official development assistance on the other hand.


Author(s):  
YUTAKA KOSAI ◽  
KENJI MATSUYAMA

Japanese official development assistance (ODA) totaled $9.13 billion in 1988, which put Japan neck and neck with the United States for the title of largest aid-donor country. In the few decades since joining the Development Assistance Committee in 1961, Japan has steadily increased its aid effort until the country is now one of the major sources of economic cooperation. This article first outlines the characteristics of Japanese ODA—such as its emphasis on loans to Asia—and then discusses the various factors that have shaped these characteristics. In recognition of the fact that yen credits are central to Japanese assistance, the significance and impact of those yen credits are then examined. Finally, some recent developments in Japanese assistance and some issues that remain to be resolved are reviewed.


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