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Determinants of Multilateral Official Development Assistance: Evidence from a Panel Study of Countries in Sub-Saharan Africa

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  • Hlavac, Marek

Abstract

Countries in sub-Saharan Africa are some of the poorest and least developed in the world, with deplorable health and education levels. One way intended to promote better living standards in this region has been through development aid. This study examines the determinants of multilateral aid inflows to sub-Saharan Africa to determine whether it is directed to the least developed countries. I use panel data about 22 countries in sub-Saharan Africa from the 1995-2004 period to estimate a regression model in which I treat multilateral aid inflows as a proportion of GDP as the dependent variable, and proxies for health levels, education and institutional quality as explanatory variables. My analysis yields some evidence, especially in panel regressions with time-fixed effects, in support of the hypothesis that countries with poorer health and education levels receive more multilateral aid as a proportion of their gross domestic products. The corruption level, as measured by the International Country Risk Guide, however, appears to be an unimportant factor in the allocation of multilateral ODA.

Suggested Citation

  • Hlavac, Marek, 2007. "Determinants of Multilateral Official Development Assistance: Evidence from a Panel Study of Countries in Sub-Saharan Africa," MPRA Paper 24243, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:24243
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    References listed on IDEAS

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    1. Alesina, Alberto & Dollar, David, 2000. "Who Gives Foreign Aid to Whom and Why?," Journal of Economic Growth, Springer, vol. 5(1), pages 33-63, March.
    2. Alberto Alesina & Beatrice Weder, 2002. "Do Corrupt Governments Receive Less Foreign Aid?," American Economic Review, American Economic Association, vol. 92(4), pages 1126-1137, September.
    3. Subhayu Bandyopadhyay & Howard J. Wall, 2007. "The determinants of aid in the post-cold war era," Review, Federal Reserve Bank of St. Louis, vol. 89(Nov), pages 533-548.
    4. John Sender, 1999. "Africa's Economic Performance: Limitations of the Current Consensus," Journal of Economic Perspectives, American Economic Association, vol. 13(3), pages 89-114, Summer.
    5. David Dollar & Craig Burnside, 2000. "Aid, Policies, and Growth," American Economic Review, American Economic Association, vol. 90(4), pages 847-868, September.
    6. Maizels, Alfred & Nissanke, Machiko K., 1984. "Motivations for aid to developing countries," World Development, Elsevier, vol. 12(9), pages 879-900, September.
    7. Ruttan, Vernon W, 1989. "Why Foreign Economic Assistance?," Economic Development and Cultural Change, University of Chicago Press, vol. 37(2), pages 411-424, January.
    8. World Bank, 2007. "World Development Indicators 2007," World Bank Publications - Books, The World Bank Group, number 8150.
    9. repec:wvu:wpaper:06-14 is not listed on IDEAS
    10. Rati Ram, 2003. "Roles of Bilateral and Multilateral Aid in Economic Growth of Developing Countries," Kyklos, Wiley Blackwell, vol. 56(1), pages 95-110, February.
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    Cited by:

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    2. Lee, Kye Woo & Hong, Minji, 2018. "Relative Effectiveness of Various Development Finance Flows: A Comparative Study," KDI Journal of Economic Policy, Korea Development Institute (KDI), vol. 40(3), pages 91-115.

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    More about this item

    Keywords

    foreign aid; health; education; development economics; sub-Saharan Africa;
    All these keywords.

    JEL classification:

    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • F5 - International Economics - - International Relations, National Security, and International Political Economy
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations

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