Working Papers, Department of Economics, Lund University
Grants to needy countries? A study of aid composition between 1975 and 2005
Abstract: This paper studies whether the poorest and most indebted
countries receive aid in the form of grants rather than loans. By studying
bilateral aid flows to low- and middle-income countries between 1975 and
2005, the paper provides evidence on the determinants of the grant
component of aid flows. While the empirical analysis finds no evidence that
more indebted countries receive a higher grant component, it shows that
poorer countries receive a significantly higher grant component of aid,
although the size of the effect is rather limited.
Keywords: Aid composition; Aid allocation; Indebtedness; Poverty; (follow links to similar papers)
JEL-Codes: F34; F35; (follow links to similar papers)
30 pages, December 17, 2009
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