The econometric literature has been unable to establish a robust association between foreign aid and growth and poverty reduction. In this paper we argue that aid effectiveness must be assessed using methods that go beyond cross-country regressions. We calibrate a dynamic general equilibrium...

Intro -- Contents -- I. INTRODUCTION -- II. RELATED LITERATURE -- III. THE MODEL -- IV. CROSS- COUNTRY INCOME DIFFERENCES -- V. POLICY EXPERIMENTS -- VI. THE AID COST OF REFORM -- VII. AID FAILURES -- VIII. CONCLUSION -- REFERENCES -- A. Optimal Fiscal Policy in a Closed Economy -- B. Optimal...

Intro -- Contents -- I. INTRODUCTION -- II. EMPIRICAL METHODOLOGY AND SAMPLE -- III. GROWTH AND FISCAL ADJUSTMENT IN TRANSITION COUNTRIES: SOME STYLIZED FACTS -- IV. ECONOMETRIC MODEL RESULTS -- V. QUALITATIVE ANALYSIS OF COUNTRY EXPERIENCES -- VI. CONCLUSIONS -- References.

The establishment of the ASEAN Economic Community (AEC) at end-2015 has brought into sharp focus the issue of financial and economic integration in the region. This paper takes stock of ASEAN’s financial integration and prospects. ASEAN integration could accelerate in the years ahead; it...

This paper constructs an efficiency-adjusted public capital stock series and re-examines the public capital and growth relationship for 52 developing countries. The results show that public capital is a significant contributor to economic growth. Although the estimated coefficient for the income...

This paper assesses the effects of fiscal consolidations associated with public debt reduction on medium-term output growth during periods of private debt deleveraging. The analysis covers 107 countries and 79 episodes of public debt reduction driven by discretionary fiscal adjustments during...

This paper offers possible explanations for three generally observed facts about fiscal policy and development: (F1) The relative size of government increases as an economy develops, (F2) The rise in government and taxation are associated with rising or constant economic growth rates, and (F3)...

This paper analyzes the relationship between fiscal adjustment and real GDP growth in a panel of 26 transition economies during 1992-2001. Unlike most previous studies using cross-country regressions, the paper finds a positive and statistically significant relationship between fiscal adjustment...

Using panel data from 120 developing countries from 1975 to 2000, this paper explores the direct and indirect channels linking social spending, human capital, and growth in a system of equations. The paper finds that both education and health spending have a positive and significant direct...

This paper assesses the effects of expenditure composition as well as fiscal adjustment on economic growth in a sample of 39 low-income countries during the 1990s. The paper finds that strong budgetary positions and fiscal consolidation are generally associated with higher economic growth in...