Axel Dreher, Vera Eichenauer, Kai Gehring, Sarah Langlotz, Steffen Lohmann, 18 October 2015

There is no consensus on whether foreign aid is effective in boosting the economy of the recipient country. This column suggests that there is no evidence that aid affects growth. This finding does not imply that aid is necessarily ineffective. Much of the aid is not given to affect growth in the first place, but as humanitarian aid following disasters, to fight terror, please political allies, or influence decisions in important international organisations. Such aid should thus be evaluated with its own goals in mind.

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