Help or Hindrance? U.S. Aid on Growth

13 Pages Posted: 16 Mar 2017

See all articles by Myongjin Kim

Myongjin Kim

University of Oklahoma - Department of Economics

Leilei Shen

Kansas State University - Department of Economics

Date Written: March 14, 2017

Abstract

We distinguish between U.S. aid and non-U.S. aid and study the effects on growth in recipient countries. Our analysis exploits time variation in aid due to changes in the supply of U.S. aid and cross-sectional variation in a country's tendency to receive any U.S. aid. We find that U.S. aid has a positive effect on growth. In particular, U.S. economic aid has a positive effect on growth while U.S. military and food aid have no effect on growth. There is also no evidence of U.S. aid crowding out aid from other countries.

Keywords: U.S. aid, growth

JEL Classification: O10, O40

Suggested Citation

Kim, Myongjin and Shen, Leilei, Help or Hindrance? U.S. Aid on Growth (March 14, 2017). Available at SSRN: https://ssrn.com/abstract=2933218 or http://dx.doi.org/10.2139/ssrn.2933218

Myongjin Kim

University of Oklahoma - Department of Economics ( email )

308 Cate Center Drive
Norman, OK 73019-2103
United States

Leilei Shen (Contact Author)

Kansas State University - Department of Economics ( email )

Manhattan, KS 66506-4001
United States

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