Foreign Aid and Economic Growth: A Panel Cointegration for Selected Turkic Republics

Balcioglu, Hasret

doi:10.18533/ijbsr.v6i6.947

Cited by 5 publications

(5 citation statements)

References 26 publications

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“…Despite the positive externality effect of foreign aid on economic growth, empirical evidence on this relationship remains inconclusive. Some studies have reported that foreign aid stimulates economic growth (Balcioglu, 2016;Bjørnskov, 2019;Rahnama et al, 2017;Magesan, 2016;Mohapatra et al, 2016;Moolio and Kong, 2016;Yiew and Lau, 2018). Others have reported either a negative or no significant relationship between foreign aid and economic growth (Adedokun, 2017;Mustafa et al, 2019;Hussain et al, 2018;Niyonkuru, 2016;Pohwani et al, 2019;Quy, 2016;Tang and Bundhoo, 2017;Weerasingha and Mustafa, 2019).…”

Section: Empirical Literaturementioning

confidence: 99%

“…In an interesting empirical analysis by Mallik (2008) on why Africa has not broken the poverty chain in spite of the heavy inflow of foreign aid, the study investigated the six worst countries living in poverty in Africa that dependent hugely on foreign aid, and concluded that foreign aid had a negative effect on economic growth based on the cointegration analytical technique. Balcioglu (2016) used panel cointegration and unit root methods to examine the role of foreign aid on economic growth in Azerbaijan, GA, Kazakhstan, Kyrgyzstan, Turkmenistan and Uzbekistan for 1992-2014 and concluded that foreign aid drives economic growth. Moolio and Kong (2016) studied the relationship between foreign aid and economic growth in Cambodia, Lao, people's democratic republic (PDR), Myanmar and Vietnam between 1997 and 2014.…”

Section: Empirical Literaturementioning

confidence: 99%

“…These studies emphasised the negative externality effect of over-dependence on foreign assistance and its unfavourable conditionality for development. Surprisingly, few studies (Balcioglu, 2016;Pallage and Robe, 2000;Singh, 1985) reported a positive economic growth effect of foreign aid, a position that negates the human social capacities conditions for foreign aid to drive economic growth.…”

Section: Introductionmentioning

confidence: 99%

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Human capital interaction on foreign aid-growth nexus: evidence from South Asia and sub-Saharan Africa

Nwani

2021

IJDI

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Purpose The purpose of this study is to examine the interactive role of human capital development (HCD) in foreign aid-growth relations in South Asia and sub-Saharan Africa countries from 1985–2019. Design/methodology/approach The study used panel data that cut across all countries in South Asia and sub-Saharan Africa collected from The World Bank’s Development Indicators. The data were analysed using Bai and Ng panel unit root idiosyncratic cross-sectional tests and the system generalised method of moments (SGMM). Findings The study found that foreign aid and HCD have negative impacts on economic growth. Fortunately, the interaction of human capital with foreign aid reduces the extent to which foreign aid impedes economic growth. The presumption is that South Asia and sub-Saharan Africa economies had not reaped the potential growth effect of foreign aid inflows due to high illiteracy rates and weak social capacities. The peculiarity of these regions hinders the absorptive capacity to transform positive externality associated with foreign aid into sizeable economic prosperity. Practical implications It is imperative for South Asia and sub-Saharan Africa countries to not depend on foreign aid; instead, the strategic action by policymakers should be to developing sustainable social capacities with HCD as the centre-piece. Originality/value The highpoint of this study is its inter-regional approach and the interplay between human capital and foreign aid using the second generation panel unit root estimator and the SGMM approaches.

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Section: Empirical Literaturementioning

confidence: 99%

Section: Empirical Literaturementioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Human capital interaction on foreign aid-growth nexus: evidence from South Asia and sub-Saharan Africa

Nwani

2021

IJDI

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“…A long-run positive correlation showed between the aid-growth relationships [20]. Another study [21] exposed that external capital flows, such as aid, had a positive impact on economic growth. Foreign aid's influence on the economic growth evaluated and outcomes indicated a positive and significant role of aid in the progression of economic growth in Vietnam [22].…”

Section: Research Elaborationsmentioning

confidence: 99%

External Debt, NODA, and GDP Growth Nexus for South Asian and Southeast Asian Selected Economies

Mazher¹,

Dahalan²

2022

JPOME

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The fundamental aim of this study is to fetch out the influence of NODA (net official development assistance) and EDS (external debt stock) on GDP growth in South Asian and Southeast Asian designated economies over 1971 to 2019. This study refers to the Solow-Swan model of economic growth as hypothetical framework in its elementary sort and employ factors such as NODA, EDS, savings, capital, depreciation, governance, and in addition total natural resources rent as control variable. Using panel data sourced from WDI (world development indicators). This study employed various econometric techniques comprise FEM (fixed effect model), panel cointegration, panel dynamic least square (DOLS), and Granger causality test for desired regression estimations. Empirical estimations evident that EDS has a negative and significant impact on GDP growth whereas, NODA had a negative and insignificant impact on GDP growth. A positive and significant influence of savings on GDP growth observed and estimation confirm that by increasing 1% in savings may cause an increase in GDP growth by 13.19 units. Capital has a positive and significant impact on GDP growth and estimation outcomes confirm that an increase of 1% in capital may cause an increase of 10.14 units. A negative and significant impact of depreciation on GDP growth revealed and it is intended that increasing 1% in depreciation may cause a decrease in GDP growth by 5.26 units. A positive and significant impact of TNRR on GDP growth revealed and estimations confirm that an increase of 1% in total natural resource rent may cause an increase in GDP growth by 0.099 units. While, impact of governance on GDP growth revealed insignificant. Lastly, it is also endorsed that a uni-directional Granger causality runs from GDP growth to EDS, EDS to NODA, and no causal relationship has been confirmed between NODA and GDP growth in SA and SEA designated economies over 1971 to 2019.

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“…The coefficients of FDI and ODA per capita have a positive impact on GDP growth as expected. Balcioglu (2016) has conducted a research on the foreign aid and economic growth, a panel cointegrationfor selected Turkic Republics. The study indicates the long-run relationship between foreign aid and real economic growth for the period 1992-2014.…”

Section: Literature Reviewmentioning

confidence: 99%

Effect of Effective Management of Donors’ Fund on ICT Sector Development in Rwanda

Harelimana¹,

Dusengimana²

2018

MOS

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The main objective of this paper is to assess the effect of effective management of donors’ fund on ICT sectordevelopment in Rwanda.A Purposive sampling have been used to select employees in charge of ICT in higher learning institutions,Broadband Systems Corporation Ltd (BSC Ltd) staff, Rwanda Information Society Authority (RISA) staff ,MINECOFIN projects implementation unit staff and Rwanda Development Board single project implementation unitstaff. In total 24 employees from these institutions contributed to this research through responding elaboratedquestionnaire and by the mean of interview. Purposively six students responded to the questionnaire.The questionnaire and an interview guide were used to collect primary data and were analyzed using StatisticalPackage for Social sciences, descriptive and inferential statistics were adopted as research approach. Qualitative datawas treated through sound content analysis.Results from the research found the following: It has been observed that the total budget of USD 24.M allocated tofinance the Rwandan ICT sector was executed up to 99.54% and all components have been implemented at asatisfactorily rate by both the World Bank and the Government of Rwanda. This high finance performance ratecaused a radical change in ICT Sector development whereby after the project implementation period elapsed, anumber of ICT sector development indicators proved a tremendous shift. One of those indicators is mobilesubscriptions and internet subscriptions that increased 217 % and 1,000% respectively. The cost of internationalinternet connectivity got an up-down shift from $10,000 in 2008 up to $125 in 2014. Both physical and financialproject implementation indicators evidenced the close relationship or the causality of ICT sector development givenan effective funds management. Finally, the Pearson coefficient of 0.814** that was obtained from testing bothvariables of this study resulted in positive high correlation between donors’ funds management and the ICT sectordevelopment.

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Foreign Aid and Economic Growth: A Panel Cointegration for Selected Turkic Republics

Cited by 5 publications

References 26 publications

Human capital interaction on foreign aid-growth nexus: evidence from South Asia and sub-Saharan Africa

Human capital interaction on foreign aid-growth nexus: evidence from South Asia and sub-Saharan Africa

External Debt, NODA, and GDP Growth Nexus for South Asian and Southeast Asian Selected Economies

Effect of Effective Management of Donors’ Fund on ICT Sector Development in Rwanda

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