PLCY 110 Lecture Notes - Lecture 4: Externality, Sustainable Development, United States Agency For International Development
Document Summary
September 8, 2016: what is foreign aid, transfer a. i. a. ii. Transfer from one government organization, individual to another government, organization, individual. Transfer of resources (money, materials, skills: main goal of aid, to accelerate growth --> achieved in aggregate, ambiguous results for many specific cases a. i. Macro picture: does aid lead to growth, graph #1 - says no relationship between aid and growth (easterly) a. i. Flat lines mean no relationship: graph #2 - growth goes down as aid goes up (easterly, bottom billion growing 1% faster than it would w/o aid (collier) d. If not what, it"s how: aid approaches: kind of structure you put in aid process determines how effective aid is, budget support - $ b. i. b. ii. Give governments of the world money and they can use it how they want. Reduces transaction costs: aid selectivity - $ in certain places c. i. c. ii. Give to countries in which they"ve achieved benchmarks in growth.
