2019
DOI: 10.1111/roie.12452
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Aid for trade and international transactions in goods and services

Abstract: The empirical literature on aid for trade (AfT) mainly considers its effects on merchandise trade and investment. In this paper, we provide an in‐depth analysis of the relationship between AfT and trade in services using both aggregate and bilateral data. We find a statistically weak effect of AfT on both goods and services trade in our aggregate analysis once we account for endogeneity in the AfT–trade relationship. In contrast, the bilateral analysis suggests that AfT, in particular that allocated to service… Show more

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Cited by 16 publications
(14 citation statements)
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“…Analyzing gross AfT commitments, Pettersson and Johansson (2013) found an elasticity of 0.09, while Hühne et al (2014) obtained an elasticity of 0.03 for the total donor exports (rather than bilateral donor exports). In contrast, Hoekman and Shingal (2020) found negative AfT‐donor export elasticities for both goods and services.…”
Section: Aid‐export Nexus: Prior Evidence2mentioning
confidence: 90%
“…Analyzing gross AfT commitments, Pettersson and Johansson (2013) found an elasticity of 0.09, while Hühne et al (2014) obtained an elasticity of 0.03 for the total donor exports (rather than bilateral donor exports). In contrast, Hoekman and Shingal (2020) found negative AfT‐donor export elasticities for both goods and services.…”
Section: Aid‐export Nexus: Prior Evidence2mentioning
confidence: 90%
“…The empirical specification and choice of explanatory variables are motivated in existing literature (Cali & te Velde, 2011 ; Martínez-Zarzoso et al, 2017 ; Hoekman & Shingal, 2020 ). The control vector, , comprises a measure of country size - the log of population ( ); a measure of geographic distance to global markets - the log of market penetration ( ) computed as a distance ( ) weighted measure of other countries’ GDP ( ) i.e.…”
Section: Empirical Strategymentioning
confidence: 99%
“…The latter has shown a mixed evidence, i.e., a positive or weak effect of AfT flows on trade performance in recipient-countries (see Cadot et al 2014 and OECD-WTO, 2017 fora detailed literature review on this matter). The majority of those studies have looked at the effects of AfT flows on trade in goods, notably export of goods, while very few studies have investigated the effectiveness of AfT flows with respect to services exports (e.g., Ghimire et al, 2013;Hoekman and Shingal, 2019;Martínez-Zarzoso et al 2017). Ghimire et al (2013) have used aggregated data and the seemingly unrelated regression (SUR) approach to investigate the effect of sectoral AfT flows (i.e., AfT allocated respectively for the promotion of the agriculture, manufacturing and services sectors) on sectoral exports (i.e., exports of agricultural products; manufacturing exports; and services exports) in recipient-countries.…”
Section: Introductionmentioning
confidence: 99%
“…In other words, total AfT flows have exerted a weak effect on services exports. The recent work by Hoekman and Shingal (2019) is interesting in that it has used both aggregate and disaggregated data (i.e., bilateral data) to examine the effect of AfT flows, including both total AfT flows and two major components of the latter (AfT for the services sector and AfT for other sectors) on both exports and imports of goods and services. The authors have used the two-stage least square (2SLS) instrumental variable approach, the Generalized Method of Moments (GMM) estimator and the Poisson pseudo-maximum likelihood (PPML) estimator.…”
Section: Introductionmentioning
confidence: 99%
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