El impacto de la ayuda internacional en la calidad de las instituciones
ISSN: 2339-9570
Year of publication: 2010
Issue: 8
Type: Working paper
More publications in: Documentos de trabajo = Working Papers ( Instituto Complutense de Estudios Internacionales ): Nueva época
Abstract
Some empirical works have argued that aid hinders the institutional quality of recipient countries. This article argues that these works suffer from two main shortcomings that make their conclusions less tenable. On the one hand, a previous investigation of the determinants of institutional quality is usually not implemented, and as a consequence, a serious omitted variables problem emerges. On the other hand, aid may show decreasing returns, but this possibility is rarely taken into account. At the aim of overcoming these shortcomings, the article presents a new estimation of an institutional quality equation that incorporates its main determinants as well as aid. Its main results suggest that aid impacts positively on institutional quality, but it shows decreasing returns.