Publication
Dec 2009
This publication examines the effects of aid on the growth of manufacturing. It finds that aid inflows have systematic adverse affects on a country's competitiveness, as reflected in the lower relative growth rate of exportable industries. The authors provide some evidence suggesting that the channel for these effects is the real exchange rate appreciation caused by aid inflows and they conjecture that this may explain why it is hard to find robust evidence that foreign aid helps countries grow.
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English (PDF, 39 pages, 621 KB) |
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Author | Raghuram G Rajan, Arvind Subramanian |
Series | CGD Working Papers |
Publisher | Center for Global Development (CGD) |
Copyright | © 2009 Center for Global Development (CGD) |