Preview

Burnside And Dollar Definition

Satisfactory Essays
Open Document
Open Document
145 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Burnside And Dollar Definition
Burnside and Dollar examine fiscal, monetary and trade policies 56 developing countries from 1970 to 1993, and compare the relevant parameters with the amount of foreign aid that these countries receive in the years and come to the conclusion that in a favorable political environment, aid has a positive impact on economic growth. The Bank's experts explain that in countries where held "correct" policies, increased aid to 1% of GDP leads to a sustainable higher growth of 0.5%. Moreover, Burnside and Dollar found that increasing aid to poor countries, where the political environment is favorable, "would have a significant positive impact on growth in developing countries." According to them, the country carried out the "right" policy, but received

You May Also Find These Documents Helpful

  • Good Essays

    Year 10 Geography Summary

    • 889 Words
    • 4 Pages

    International Aid – assistance developed countries give to developing countries to encourage economic growth and improve living standards…

    • 889 Words
    • 4 Pages
    Good Essays
  • Good Essays

    In fact, foreign aid agencies do wonderful humanitarian work to help people around the world. However, their system that they use has flaws. Too often optimists attribute failures in development and economic growth to a lack of donations. Professor and Humanitarian, Jeffrey Sachs, in his book The End of Poverty points out the apparent failure of the United States regarding the government’s goal to donate 0.5% of its GDP towards foreign aid. While his data at first appears to show the United States and other developed countries’ failure to reach 0.5% of their GDP, Sachs does not account for inflation in which the value of money changes with supply and demand over time. He also fails to refer to what currency his data uses whether the graph uses USD or the Euro, which affects the amount needed to reach 0.5% due to the difference in value of different currencies. Sachs’s deceptive statistics creates the illusion that developed countries refuse to offer enough money to make changes. The U.S. along with Germany, France, Italy, and other top donors for foreign aid actually donate more money each year despite the slow or decreasing GDP growth (see in figure 4). By using manipulative data, optimistic authors such as Sachs do not account for complex factors including inflation and immediately turn blame towards a lack of money and paint the image of crass developed…

    • 1064 Words
    • 5 Pages
    Good Essays
  • Good Essays

    Studies were able to differentiate between “good” and “bad” governments based on certain characteristics that took in account corruption, democracy, etc. It was weird that in conclusion the type of government in charge of a state had no impact on how well the aid given to them fostered growth. Part of the reason for this conclusion was that aid would sometimes be given simply for political reasons or other less effective long-term means. The takeoffs that Planners push for are also very rare and largely unrealistic. Meanwhile, booming economies like China and India are growing in no part thanks to aid. In a nutshell, Easterly describes just how useless aid actually is. A further problem with giving aid is much of the aid seems to be going toward consumption and not long-term investment. If this is the case, no one wonder aid isn’t sparking growth. Easterly does also ponder if growth would be even worse without aid. Perhaps aid doesn’t help too much, but it is also very possible that without aid, the poor states would be even more devastated. He addresses all parts of the arguments and takes into account multiple opposing views and…

    • 1551 Words
    • 7 Pages
    Good Essays
  • Better Essays

    The Sand Dollar

    • 1716 Words
    • 7 Pages

    Splash!! Of course it’s me being picked up by every human and throwing me as far away out as possible. It gets me very angry and annoyed because the humans don’t treat me with enough respect as some other organisms living here. Humans don’t look at me as a living creature and I have the same systems and some of the same body parts as them but I’m just a lot smaller in size. They get angry at me for trying to get away using my spines to move along the sand. People who pick me up don’t even attempt to look at me and just think I’m not even a living creature. Everyday humans in general throw me around like I am a toy but I have qualities they have also but don’t realize. I always ask myself “Why can’t I be one of those things left on the sand and not get thrown around with?” I wake up every day down and feeling miserable because I am so overlooked its misfortunate.…

    • 1716 Words
    • 7 Pages
    Better Essays
  • Good Essays

    Discuss the factors holding back countries growth, and evaluate the measures used to aid growth in the future…

    • 2079 Words
    • 9 Pages
    Good Essays
  • Good Essays

    Firstly, the USA’s contribution of financial aid and economic stability contributed greatly to the growth of the global economy. The Americans sought to quickly help speed up the recovery of global economy after WWII, in fear that Communism would spread to weak and unstable countries, and one of its plans involved the Marshall Plan that provided US$13 billion to Europe. Similarly, countries in Asia received US$5.9 billion. These enormous sums of aid was extremely vital in helping to kick start the recovery of economies worldwide because governments now had funds needed to rebuild their capital and infrastructure. The results were soon evident in the 1960s when the rise of European and Japanese economies added rise in global output and capitalization, thus benefitting the global economy tremendously.…

    • 1189 Words
    • 5 Pages
    Good Essays
  • Good Essays

    Foreign Aid

    • 575 Words
    • 3 Pages

    The United States of America is a wealthy nation. We are also a nation that reaches out to the poverty-stricken world, lending financial aid in ridiculous amounts to these shambled countries. The burning question of the moment is: how effect is our foreign aid, and what can we do to improve its efficiency?…

    • 575 Words
    • 3 Pages
    Good Essays
  • Good Essays

    Fiscal Policy

    • 1198 Words
    • 5 Pages

    Economic growth can be improved by price stability, influencing the consumption pattern, economic development and removal of deficit in balance of payments. Price stability, inflation and deflation are the big vices which the capitalist world has to face. During the inflation, there are economic sufferings for the fixed income groups. Moreover, the inflation creates so many long-run social and economic problems. If government expenditures are reduced and taxes are increased - all they will reduce NI many a time through multiplier effect. Thus, when excess demand is controlled - the inflation will be controlled. On the other hand, during deflation, if government expenditures are increased and taxes are reduced - then, NI will go up through multiplier effect and economic depression will come to an end. But in most of the poor countries, government expenditures are rigid downward. Moreover the government expenditures and imposition of taxes are influenced by political decisions. The curtailment of government expenditures and raising of the taxes will obstruct economic activities - producers will be disappointed and foreign private investment is discouraged.…

    • 1198 Words
    • 5 Pages
    Good Essays
  • Powerful Essays

    In an endogenous growth model with public finance including tax, expenditure and components of government expenditure by function, this study characterizes fiscal policy for some ASEAN economies, also the relationship between the growth rate, tax rate and expenditure shares on the GDP. Moreover, it examines the impact of different components of government expenditure by function on economic growth. I use panel data of two samples. There are seven ASEAN countries in first sample and five ASEAN countries in second sample over 28 years. I use linear regression techniques for panel data. According to estimation results, government spending has negative and significant effects on the growth rate. In contrast, tax revenue has positive impact on economic growth. My empirical results are obtained by using Barro model (1990) and Devarajan et al. (1996).…

    • 14127 Words
    • 57 Pages
    Powerful Essays
  • Powerful Essays

    basis from which each country has pursued economic growth over the past quarter century was…

    • 8035 Words
    • 33 Pages
    Powerful Essays
  • Powerful Essays

    18. Thirlwall A.P (1999), Growth and Development: with Special Reference to Developing Economies (London: Macmillan).…

    • 7550 Words
    • 31 Pages
    Powerful Essays
  • Powerful Essays

    The Washington Consensus

    • 4718 Words
    • 19 Pages

    The Washington Consensus was formulated in 1989 in response to the failure of the developmental aid in yielding the results desired. It was attributed to ineffective government institutions and therefore proposed that economic growth be left to the market and were subsequently adopted by the International Financial Institutions of the International Monetary Fund (IMF) and World Bank (WB) as part of their structural adjustment policies. The results of this policy saw some short lived positive results but were predominantly characterised by worsened conditions and the neglect of developmental issues. Concurrently, the success of the East Asian Countries forced economists within the IMF to revise the policy calling for more state intervention in conjunction with the market and gave rise to the Post Washington Consensus. The extent to which these two policies differ and whether they offer new opportunities for the South shall be discussed in this assignment.…

    • 4718 Words
    • 19 Pages
    Powerful Essays
  • Powerful Essays

    Fiscal Performance

    • 4637 Words
    • 19 Pages

    Properly managed public expenditures can contribute much to economic growth e.g. through increasing income levels and generating additional employment. In developing countries, expenditure policies are designed and…

    • 4637 Words
    • 19 Pages
    Powerful Essays
  • Powerful Essays

    Farzin, Y.H. 1988. “The Relationship of External Debt and Growth. Sudan’s Experience, 1975-1984”. World Bank Discussion Paper 24…

    • 4101 Words
    • 17 Pages
    Powerful Essays