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Aid and Trade - An Empirical Analysis of the Impact of European Development Aid on Donor’s Exports

Endres, Kai LU and Greally, Cathal Patrick (2023) NEKN01 20231
Department of Economics
Abstract
This study examines the relationship between development aid and trade, specifically focusing on the impact of aid on exports for 14 European donor countries committed to allocating 0.70% of their Gross National Income (GNI) to official development assistance (ODA). The 14 selected countries account for 41.5% of global ODA disbursements. Estimating a structural gravity model using Pseudo Poisson Maximum Likelihood estimators and panel data covering the period from 1995 to 2021, the findings reveal a significant and positive relationship between European development aid and donor’s exports. One US$ more spent on development aid leads to an increase in exports of 0.19 US$ on average. Our findings show that the effect of aid on exports... (More)
This study examines the relationship between development aid and trade, specifically focusing on the impact of aid on exports for 14 European donor countries committed to allocating 0.70% of their Gross National Income (GNI) to official development assistance (ODA). The 14 selected countries account for 41.5% of global ODA disbursements. Estimating a structural gravity model using Pseudo Poisson Maximum Likelihood estimators and panel data covering the period from 1995 to 2021, the findings reveal a significant and positive relationship between European development aid and donor’s exports. One US$ more spent on development aid leads to an increase in exports of 0.19 US$ on average. Our findings show that the effect of aid on exports increases with more intense aid relationships Further, we apply several robustness checks to underpin our findings. (Less)
Popular Abstract
This study examines the relationship between development aid and trade, specifically focusing on the impact of aid on exports for 14 European donor countries committed to allocating 0.70% of their Gross National Income (GNI) to official development assistance (ODA). The 14 selected countries account for 41.5% of global ODA disbursements. Estimating a structural gravity model using Pseudo Poisson Maximum Likelihood estimators and panel data covering the period from 1995 to 2021, the findings reveal a significant and positive relationship between European development aid and donor’s exports. One US$ more spent on development aid leads to an increase in exports of 0.19 US$ on average. Our findings show that the effect of aid on exports... (More)
This study examines the relationship between development aid and trade, specifically focusing on the impact of aid on exports for 14 European donor countries committed to allocating 0.70% of their Gross National Income (GNI) to official development assistance (ODA). The 14 selected countries account for 41.5% of global ODA disbursements. Estimating a structural gravity model using Pseudo Poisson Maximum Likelihood estimators and panel data covering the period from 1995 to 2021, the findings reveal a significant and positive relationship between European development aid and donor’s exports. One US$ more spent on development aid leads to an increase in exports of 0.19 US$ on average. Our findings show that the effect of aid on exports increases with more intense aid relationships Further, we apply several robustness checks to underpin our findings. (Less)
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author
Endres, Kai LU and Greally, Cathal Patrick
supervisor
organization
course
NEKN01 20231
year
type
H1 - Master's Degree (One Year)
subject
keywords
gravity model, development aid, exports, PPML, fixed effects, trade
language
English
id
9118389
date added to LUP
2023-09-12 15:38:04
date last changed
2023-09-12 15:38:04
@misc{9118389,
  abstract     = {{This study examines the relationship between development aid and trade, specifically focusing on the impact of aid on exports for 14 European donor countries committed to allocating 0.70% of their Gross National Income (GNI) to official development assistance (ODA). The 14 selected countries account for 41.5% of global ODA disbursements. Estimating a structural gravity model using Pseudo Poisson Maximum Likelihood estimators and panel data covering the period from 1995 to 2021, the findings reveal a significant and positive relationship between European development aid and donor’s exports. One US$ more spent on development aid leads to an increase in exports of 0.19 US$ on average. Our findings show that the effect of aid on exports increases with more intense aid relationships Further, we apply several robustness checks to underpin our findings.}},
  author       = {{Endres, Kai and Greally, Cathal Patrick}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{Aid and Trade - An Empirical Analysis of the Impact of European Development Aid on Donor’s Exports}},
  year         = {{2023}},
}