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Are there Negative Returns to Aid? a Comment [electronic resource] / Mwanza Nkusu.

By: Nkusu, Mwanza.
Material type: materialTypeLabelBookSeries: IMF Working Papers; Working Paper: No. 04/212Publisher: Washington, D.C. : International Monetary Fund, 2004Description: 1 online resource (12 p.).ISBN: 1451874928 :.ISSN: 1018-5941.Subject(s): Calibration | Economic Growth and Aggregate Productivity: General | Equation | Nonlinearity | Paper | Welfare and Poverty: GeneralAdditional physical formats: Print Version:: Are there Negative Returns to Aid? a CommentOnline resources: IMF e-Library | IMF Book Store Abstract: Amid controversies surrounding aid effectiveness, an increasing number of empirical studies find support for the idea that aid can spur growth and that the aid-growth relationship is nonlinear. Lensink and White propose a model to illustrate the possible existence of what has been labeled an "aid Laffer curve." This short paper highlights the model's weaknesses and suggests that the model does not fulfill the purpose of illustrating the possible existence of negative returns to aid.
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Amid controversies surrounding aid effectiveness, an increasing number of empirical studies find support for the idea that aid can spur growth and that the aid-growth relationship is nonlinear. Lensink and White propose a model to illustrate the possible existence of what has been labeled an "aid Laffer curve." This short paper highlights the model's weaknesses and suggests that the model does not fulfill the purpose of illustrating the possible existence of negative returns to aid.

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