14 Foreign Aid and Revenue Response: Does the Composition of Aid Matter?
Author:
Sanjeev Gupta
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Language:
English
Print Publication Date:
17 Sep 2004
Keywords:
BOOK; country; user payment; per capita income; francophone country; recipient country; exchange rate; hazard function; Health care spending; Africa; Western Hemisphere; Sub-Saharan Africa; Global; Asia and Pacific

Abstract

The debate on the effectiveness of foreign aid has revolved for some time around the relative efficiency of loans versus grants. Since the early 1960s, an often-repeated view has been that loans are used more efficiently than grants because they are expected to be repaid. Furthermore, the need for repayment motivates governments to select projects or programs whose benefits exceed costs (see Schmidt, 1964). Therefore, concessional loans are better for meeting the objectives underlying development assistance (see Singer, 1961).

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Cover Helping Countries Develop
Helping Countries Develop
The Role of Fiscal Policy
ISBN:
9781589063181
Publication Date:
17 Sep 2004
Publisher:
International Monetary Fund
DOI:
https://doi.org/10.5089/9781589063181.071
Pages:
540
Front Matter
1 Fiscal Policy for Economic Development: An Overview
I Macroeconomic Policy in Developing Countries
II Public Spending and the Millennium Development Goals
III Revenues and Growth
IV. Fiscal Policy and Aid
V. Special Topics

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