Abstract
We examine how the source of foreign aid affects the composition of the recipient government's spending. Does the source of aid - bilateral or multilateral - influence recipient policy-makers' choice between development and nondevelopment expenditure? We depart from previous literature by introducing strong asymmetries in policy-makers' preferences. With the financial constraints set by foreign aid and domestic revenues, this formalization allows us to model and estimate the fiscal behavior of government policy-makers in the presence of foreign aid.
Original language | English (US) |
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Pages (from-to) | 121-134 |
Number of pages | 14 |
Journal | Empirical Economics |
Volume | 24 |
Issue number | 1 |
DOIs | |
State | Published - May 25 1999 |
All Science Journal Classification (ASJC) codes
- Statistics and Probability
- Mathematics (miscellaneous)
- Social Sciences (miscellaneous)
- Economics and Econometrics
Keywords
- Foreign aid
- India