IDEAS home Printed from https://ideas.repec.org/p/fau/wpaper/wp2024_29.html
   My bibliography  Save this paper

The Effect of Financial Transparency on Aid Diversion

Author

Listed:
  • Jan Zalman

    (Institute of Economic Studies, Charles University, Prague, Czech Republic)

Abstract

Aid diversion poses a significant challenge to aid-recipient countries by depleting vital resources and hindering sustainable development. In many developing nations, high levels of corruption raise concerns about whether aid funds reach their intended destination. This paper studies the impact of financial transparency on aid diversion by focusing on global efforts to reduce secrecy in tax havens since 2009. We explore how the global push to end bank secrecy has affected aid capture, finding a significant reduction in aid diversion, particularly after 2008. This reduction aligns with the initial release of customer information from tax havens, highlighting the effectiveness of the transparency measures. Our results have important implications for foreign aid allocation strategies, especially in countries involved in offshore leaks and with high corruption levels, highlighting the need for continued efforts to enhance financial transparency.

Suggested Citation

  • Jan Zalman, 2024. "The Effect of Financial Transparency on Aid Diversion," Working Papers IES 2024/29, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised Aug 2024.
    • Handle: RePEc:fau:wpaper:wp2024_29
    as

    Download full text from publisher

    File URL: https://ies.fsv.cuni.cz/en/effect-financial-transparency-aid-diversion
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    aid capture; offshore bank deposits; foreign aid; financial transparency; tax;
    All these keywords.

    JEL classification:

    • F35 - International Economics - - International Finance - - - Foreign Aid
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fau:wpaper:wp2024_29. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Natalie Svarcova (email available below). General contact details of provider: https://edirc.repec.org/data/icunicz.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.