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USAID, official development assistance and counter terrorism efforts: Pre and post 9/11 analysis for South Asia

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  • Shahzad, Umer
  • Sarwar, Suleman
  • Farooq, Muhammad Umar
  • Qin, Fengming

Abstract

The 9/11 terrorist attacks in United States and the subsequent declaration of war on terror have upturned worldwide issues including terrorist attacks, fatalities, disbursement of foreign aid and development assistance. Since 9/11 attacks, US economic and military aids and official development assistance have played a vital role in the South Asian region. Present study is the pioneer to examine the reaction of different types of foreign aid toward counter-terrorism policies. For this purpose, the paper used annual data of studied factors for the period 1991 to 2016 and employed three models as preferred and full specification, pre and post 9/11 analysis and financial crisis analysis. For econometric estimations, the study used quantile regression method, negative binomial regression, system GMM and two stage IV regression techniques with different control variables. Accordingly, the study documented that all types of foreign aid namely; development assistance, economic aid, military aid fuels terrorism in recipient countries, due to institutional problems or ongoing civil conflicts. We also find evidence that military expenditures and media freedom tends to have negative relationship on terrorism.

Suggested Citation

  • Shahzad, Umer & Sarwar, Suleman & Farooq, Muhammad Umar & Qin, Fengming, 2020. "USAID, official development assistance and counter terrorism efforts: Pre and post 9/11 analysis for South Asia," Socio-Economic Planning Sciences, Elsevier, vol. 69(C).
    • Handle: RePEc:eee:soceps:v:69:y:2020:i:c:s0038012119300345
    DOI: 10.1016/j.seps.2019.06.001
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    6. Muhammad Farhan Bashir & Benjiang MA & Muhammad Shahbaz & Zhilun Jiao, 2020. "The nexus between environmental tax and carbon emissions with the roles of environmental technology and financial development," PLOS ONE, Public Library of Science, vol. 15(11), pages 1-20, November.
    7. Lee, Chien-Chiang & Wang, Chih-Wei & Ho, Shan-Ju, 2022. "Financial aid and financial inclusion: Does risk uncertainty matter?," Pacific-Basin Finance Journal, Elsevier, vol. 71(C).
    8. Santos Bila & Mduduzi Biyase & Matias Farahane & Thomas Udimal, 2023. "Foreign Aid And Economic Growth In Sub-Saharan African Countries," Economics Working Papers edwrg-03-2023, College of Business and Economics, University of Johannesburg, South Africa, revised 2023.

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    More about this item

    Keywords

    USAID; Official development assistance; Economic aid; Negative binomial regression; Terrorism; South Asia;
    All these keywords.

    JEL classification:

    • F35 - International Economics - - International Finance - - - Foreign Aid
    • O2 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • N40 - Economic History - - Government, War, Law, International Relations, and Regulation - - - General, International, or Comparative
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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