The Anarchy of Numbers: Aid, Development, and Cross-Country Empirics

  title={The Anarchy of Numbers: Aid, Development, and Cross-Country Empirics},
  author={David Malin Roodman},
  journal={Political Economy: Development eJournal},
  • D. Roodman
  • Published 1 August 2003
  • Economics
  • Political Economy: Development eJournal
Recent literature contains many stories of how foreign aid affects economic growth. All the stories hinge on the statistical significance in cross-country regressions of a quadratic term involving aid. Among the stories are that aid raises growth (on average) 1) in countries where economic policies are good; 2) in countries where policies are good and a civil war recently ended; 3) in all countries, but with diminishing returns; 4) in countries outside the tropics; 5) in countries with… 
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