Aid, China, and Growth: Evidence from a New Global Development Finance Dataset
Date Published
May 1, 2021
Authors
Axel Dreher, Andreas Fuchs, Bradley Parks, Austin Strange, Michael J. Tierney
Publisher
American Economic Journal: Economic Policy
Citation
Dreher, Axel, Andreas Fuchs, Bradley Parks, Austin Strange, and Michael J. Tierney. 2021. "Aid, China, and Growth: Evidence from a New Global Development Finance Dataset." American Economic Journal: Economic Policy, 13 (2): 135-74.
Note: A version of this article was previously published as an AidData Working Paper.
Abstract
This article introduces a new dataset of official financing from China to 138 developing countries between 2000 and 2014. It investigates whether Chinese development finance affects economic growth in recipient countries. The results demonstrate that Chinese development finance boosts short-term economic growth. An additional project increases growth by between 0.41 and 1.49 percentage points two years after commitment, on average. While this study does not find that significant financial support from China impairs the overall effectiveness of aid from Western donors, aid from the United States tends to be more effective in countries that receive no substantial support from China.
Featured Authors
Axel Dreher
Professor of Economics and Chair of International and Development Politics at Heidelberg University
Andreas Fuchs
Professor of Development Economics at the University of Goettingen
Bradley C. Parks
Executive Director
Austin Strange
Assistant Professor, University of Hong Kong
Mike Tierney
Co-Director of the Global Research Institute and Hylton Professor of Government and International Relations at the College of William & Mary
