Logo
Munich Personal RePEc Archive

Foreign aid, instability and governance in Africa

Asongu, Simplice and Nnanna, Joseph (2019): Foreign aid, instability and governance in Africa. Published in: Politics & Policy , Vol. 44, No. 4 (August 2019): pp. 807-848.

[thumbnail of MPRA_paper_101087.pdf]
Preview
PDF
MPRA_paper_101087.pdf

Download (284kB) | Preview

Abstract

This study contributes to the attendant literature by bundling governance dynamics and focusing on foreign aid instability instead of foreign aid. We assess the role of foreign aid instability on governance dynamics in fifty three African countries for the period 1996-2010. An autoregressive endogeneity-robust Generalized Method of Moments is employed. Instabilities are measured in terms of variance of the errors and standard deviations. Three main aid indicators are used, namely: total aid, aid from multilateral donors and bilateral aid. Principal Component Analysis is used to bundle governance indicators, namely: political governance (voice & accountability and political stability/no violence), economic governance (regulation quality and government effectiveness), institutional governance (rule of law and corruption-control) and general governance (political, economic and institutional governance). Our findings show that foreign aid instability increases governance standards, especially political and general governance. Policy implications are discussed.

Atom RSS 1.0 RSS 2.0

Contact us: mpra@ub.uni-muenchen.de

This repository has been built using EPrints software.

MPRA is a RePEc service hosted by Logo of the University Library LMU Munich.