Rogue aid? An empirical analysis of China's aid allocation

Dreher, Axel; Fuchs, Andreas

doi:10.1111/caje.12166

Cited by 201 publications

(169 citation statements)

References 43 publications

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“…Sanfilippo () also identifies market size and resource endowment as the main drivers of Chinese FDI, finding that these same factors attract Chinese aid projects in Africa even more. The above results contrast, however, with those of Dreher and Fuchs (), who provide empirical evidence showing that Chinese aid is independent of recipients' natural resources endowment and institutional characteristics. Thus, despite the common belief in the west, the empirical evidence on the resource‐seeking nature of China's involvement in Africa is actually mixed.…”

Section: China's Involvement In Africa: Nature and Causescontrasting

confidence: 84%

The economics of China's engagement with Africa: What is the empirical evidence?

Martuscelli

2019

Development Policy Review

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Motivation In the last decade, economic and political ties between China and African countries grew fast, fuelling a heated debate about the implications for the latter and for the global system of China's engagement in Africa. Purpose The article reviews the existing evidence on the nature, causes and impact of China's economic engagement in Africa. Approach and methods The review focuses mainly on the economic literature with a quantitative focus. Findings China's reasons to engage with Africa are not so different from those of western countries: securing natural resources and seeking new export markets. However, there is evidence that China is less interested in the quality of governance and institutions of its African partners. The literature tends to agree on the positive growth effects for African countries of Chinese interest, but also suggests that their already thin manufacturing sector could be adversely affected by Chinese competition and that the increasing natural resource specialization of African countries might hamper diversification, structural transformation and future growth prospects. At the same time Chinese investments are building valuable infrastructure and linkages with local firms, which are growing although still very limited. The emergent trend of increasing presence of small and medium Chinese firms in Africa is promising in this respect. Policy implications Increased Chinese interactions with African countries present opportunities as well as threats for African countries. A key aspect will be the capacity of Chinese presence in Africa to spread to the local economy through spillover effects and linkages to the domestic economy. Both sides should introduce policies aimed at strengthening these linkages and spillovers.

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Section: China's Involvement In Africa: Nature and Causescontrasting

confidence: 84%

The economics of China's engagement with Africa: What is the empirical evidence?

Martuscelli

2019

Development Policy Review

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“…The first group reflects selfish motives in aid allocation and is approximated by variables measuring donors' exports or bilateral trade with recipients or by variables describing different kinds of relationships and closeness between donors and recipients (common colonial links, geographic distance, cultural proximity, etc.). It is predicted that the volume of aid will be positively influenced by the intensity of donors' interests and by the proximity of mutual relationships [30][31][32][33][34][35].…”

Section: Methodsmentioning

confidence: 99%

Is Foreign Aid Responsive to Environmental Needs and Performance of Developing Countries? Case Study of the Czech Republic.

Opršal

Harmáček

2019

Sustainability

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“…To examine the claim that China's aid is characterized by -rogue aid‖ that guided by selfish interests alone, Dreher and Fuchs (2015) empirically tested to what extent self-interests shape China's aid allocation, based on the data on Chinese project aid, food aid, medical staff and total aid money to developing countries from 1956 to 2006. The evidence suggested that China's aid allocation does not depend on recipients' endowment with natural resources.…”

Section: China's Foreign Aidmentioning

confidence: 99%

US and China Aid to Africa: Impact on the Donor-Recipient Trade Relations

Liu

Tang

2016

SSRN Journal

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This paper investigates the impact of the US and China's foreign aids to Africa on trade flows between donor and recipient countries. Evidence from the gravity model estimates reveals that the two donors' exports are strengthened by their aids to African partners.Interestingly, China's aid shows a positive effect on its total volume of trade and imports from Africa, while the aid from the US exhibits little impact on the US-Africa total trade and its imports from Africa. A possible explanation for such a difference could be due to the dissimilar national interests of donors in Africa. This study finally suggests that African countries should accelerate the pace of advancing domestic economies and rely less on foreign assistance, in order to establish a fairer and more equal international economic order. JEL Classification: F35, P33

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Rogue aid? An empirical analysis of China's aid allocation

Cited by 201 publications

References 43 publications

The economics of China's engagement with Africa: What is the empirical evidence?

The economics of China's engagement with Africa: What is the empirical evidence?

Is Foreign Aid Responsive to Environmental Needs and Performance of Developing Countries? Case Study of the Czech Republic.

US and China Aid to Africa: Impact on the Donor-Recipient Trade Relations

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