Foreign Aid and Free Trade and their Effect on Income: a Panel Analysis

  title={Foreign Aid and Free Trade and their Effect on Income: a Panel Analysis},
  author={Abdiweli M. Ali and Hodan Said Isse},
  journal={The Journal of Developing Areas},
  pages={127 - 142}
This paper uses a panel approach and annual observations of over 150 countries for the period 1975 – 2000 to examine the impact of foreign aid and trade on income. The paper addresses the simultaneity of international trade, foreign aid and economic performance by using a full information system or three-stage least squares approach. The findings of this paper strongly suggest that foreign aid and trade are strong determinants of GDP per worker, albeit in opposite directions. The regression… 

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  • 1973
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