IDEAS home Printed from https://ideas.repec.org/p/hal/journl/hal-00974445.html
   My bibliography  Save this paper

A theory of aid as trade

Author

Listed:
  • Bernard Poirine

    (GDI - Gouvernance et développement insulaire - UPF - Université de la Polynésie Française)

Abstract

This article presents a theory of aid as trade. I assume that aid is a payment for an invisible export of strategic services to a large donor country seeking diplomatic goodwill and exclusive strategic use of a small country's territory, oceanic space and airspace. In a formal two countries-two goods model, the strategic service is produced with a higher productivity in the small country/island because of its geographic location (close to a potential enemy of the large country, for example). The other good is a composite manufactured good produced with higher productivity in the large country. There are gains from international trade that can be obtained by both countries, and divided between them. The citizen of both countries are better off: a lower cost for defense of the large industrial country, and a geostrategic rent for the citizen of the small country, enabling them to finance a deficit of the official balance of goods and services.

Suggested Citation

  • Bernard Poirine, 1999. "A theory of aid as trade," Post-Print hal-00974445, HAL.
    • Handle: RePEc:hal:journl:hal-00974445
    Note: View the original document on HAL open archive server: https://hal.science/hal-00974445
    as

    Download full text from publisher

    File URL: https://hal.science/hal-00974445/document
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Haoatai, Heinarii & Monypenny, Richard, 2011. "Export demand for Tahitian black pearls," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 19, pages 1-16.
    2. Simone Juhasz Silva & Douglas Nelson, 2012. "Does Aid Cause Trade? Evidence from an Asymmetric Gravity Model," The World Economy, Wiley Blackwell, vol. 35(5), pages 545-577, May.
    3. Baldacchino, Godfrey, 2006. "Innovative development strategies from Non-Sovereign Island jurisdictions? A global review of economic policy and governance practices," World Development, Elsevier, vol. 34(5), pages 852-867, May.
    4. Balcilar, Mehmet & Kutan, Ali M. & Yaya, Mehmet E., 2017. "Testing the dependency theory on small island economies: The case of Cyprus," Economic Modelling, Elsevier, vol. 61(C), pages 1-11.
    5. Dunn, Leslie, 2011. "The Impact of Political Dependence on Small Island Jurisdictions," World Development, Elsevier, vol. 39(12), pages 2132-2146.
    6. Cook, Paul & Kirkpatrick, Colin, 1998. "Labor market adjustment in small open economies: The case of Micronesia," World Development, Elsevier, vol. 26(5), pages 845-855, May.
    7. Bertram, Geoffrey, 2004. "On the Convergence of Small Island Economies with Their Metropolitan Patrons," World Development, Elsevier, vol. 32(2), pages 343-364, February.

    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:hal:journl:hal-00974445. 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: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

    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.