Foreign aid as a catalyst for improving productive capabilities in recipients

Arpaci‐Ayhan, Sevde

doi:10.1002/jid.3706

Cited by 4 publications

(3 citation statements)

References 77 publications

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“…The limited number of studies on the effect of AfT flows on economic complexity has not come up with a clear-cut conclusion concerning the direction of this effect, with some of them reporting the absence of such an effect (e.g., Arpaci-Ayhan, 2022;Gnangnon, 2021b;Hai, 2021;Kamguia et al, 2022;Kim, 2019). Kim (2019) has found no significant effect of AfT on export sophistication either in the short run or in the long run.…”

Section: Effect Of Aft Flows On Economic Complexitymentioning

confidence: 99%

“…We investigate empirically the effect of the quality of total AfT flows (that reflects total AfT, its predictability and volatility) on economic complexity by drawing from the few existing studies on the effect of AfT flows on economic complexity (e.g., Arpaci-Ayhan, 2022;Gnangnon, 2021b;Hai, 2021;Kamguia et al, 2022;Kim, 2019), and more generally on studies 15 that have explored the macroeconomic factors underpinning economic complexity.…”

Section: Model Specificationmentioning

confidence: 99%

“…The existing few studies on the economic complexity effect of AfT flows have reached mixed conclusions regarding the effect of AfT flows on economic complexity (e.g., Arpaci-Ayhan, 2022;Gnangnon, 2021b;Hai, 2021;Kamguia et al, 2022;Kim, 2019). This lack of a clear-cut direction of the economic complexity effect of AfT flows prompts us to question whether in addition to the total amount of AfT, the predictability of these capital inflows and the low volatility (i.e., increased stability) of these resource inflows matter for fostering economic complexity in recipient countries.…”

Section: Introductionmentioning

confidence: 99%

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The quality of Aid for Trade flows and economic complexity

Gnangnon

2024

Int Econ Econ Policy

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The few existing studies on the effect of Aid for Trade (AfT) flows on economic complexity have reached inconclusive outcomes. The present analysis re-examines this issue through the lens of the concept of 'quality of AfT flows' that takes into account not only the amount of AfT flows, but also the predictability and volatility of these capital inflows. A country enjoys a better quality of AfT flows if it receives higher AfT flows in a predictable and less volatiles fashions. We investigate the effect of the quality of AfT flows on economic complexity, over a set of 86 countries and the period from 2004 to 2019, and using the within fixed effects estimator and the Method of Moments Quantile Regression with fixed effects approach. The findings suggest that not only does a better quality of AfT flows fosters economic complexity in recipient countries, but its positive effect is larger in less complex economies (including poorest countries) than in relatively more complex economies among recipient countries. These findings reveal that what really matters for the enhancement of economic complexity in developing countries may not be only the amounts of the total AfT flows, but more importantly the predictability and the stability of these resource inflows. Improving the quality of AfT flows by increasing AfT amounts in a predictable and stable fashions would be beneficial to developing countries, and particularly to a greater extent to poorest countries among them.

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Section: Effect Of Aft Flows On Economic Complexitymentioning

confidence: 99%

Section: Model Specificationmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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The quality of Aid for Trade flows and economic complexity

Gnangnon

2024

Int Econ Econ Policy

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Modelling asymmetric and nonlinear features in the natural resource wealth-economic complexity nexus: empirical insights from Nigeria

Olaniyi,

Odhiambo

2024

Miner Econ

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Contrary to previous research, this study makes a unique contribution to the global discussion by incorporating asymmetric structure and nonlinearity into the analysis of how changes in natural resource wealth affect economic complexity. To achieve this objective, the study uses a nonlinear autoregressive distributed lag (ARDL) and a fully modified ordinary least squares estimator, utilizing data from Nigeria spanning the period 1984–2021. Unlike earlier studies, this study establishes robust evidence of nonlinearity and asymmetry in the sensitivity of economic complexity to changes in natural resource rents in the short and long run. The cumulative increases (positive shock components) in natural resource wealth provide strong stimuli and incentives that promote economic complexity in the short run, while the cumulative decreases (negative shock components) deteriorate economic complexity upgrades. Meanwhile, long-run estimates indicate that both positive and negative shock components are catalysts that impede Nigeria’s manufacturing structures’ ability to improve technological innovation and knowledge-based productive capacity for producing sophisticated and globally competitive exports. These findings imply that the resource curse phenomenon holds true regarding economic complexity in Nigeria in the long run. In conclusion, this study finds that Nigeria’s natural resource endowments breed complacency, racketeering, shrewdness, corrupt practices, and opportunistic behaviour, which impair innovative initiatives that spur economic complexity. This study outlines the policy implications and insights from the findings.

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Does institutional quality matter in the financial Development-Economic complexity Nexus? Empirical insights from Africa

Olalekan Olaniyi,

Mbaya Odhiambo

2023

Research in Globalization

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Foreign aid as a catalyst for improving productive capabilities in recipients

Cited by 4 publications

References 77 publications

The quality of Aid for Trade flows and economic complexity

The quality of Aid for Trade flows and economic complexity

Modelling asymmetric and nonlinear features in the natural resource wealth-economic complexity nexus: empirical insights from Nigeria

Does institutional quality matter in the financial Development-Economic complexity Nexus? Empirical insights from Africa

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