Aid unpredictability and Economic Growth in Kenya

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dc.contributor.authorOjiambo, Elphas
dc.contributor.authorOduor, Jacob
dc.contributor.authorMburu, Tom
dc.contributor.authorWawire, N. H. W.
dc.date.accessioned2015-11-17T12:13:48Z
dc.date.available2015-11-17T12:13:48Z
dc.date.issued2015
dc.description.abstractStudies on the impacts of aid on growth are not limited. Some have found positive effects, others negative effects, others no effect and others have found positive impacts only under certain conditions. A less examined aspect is the role of aid unpredictability on growth. While aid unpredictability may negatively affect growth when it disorientates the recipient country’s consumption and investment planning, it may also boost economic growth if it is triggered by responses to economic shocks. It may also induce strengthening of systems of aid absorption in the recipient country that improves aid effectiveness and economic growth. This paper assesses the heterogeneous impacts of aid on growth in a low income country with different aid unpredictability episodes and finds that increased aid unpredictability weakens economic growth in Kenya. In addition, aid unpredictability is found to improve economic growth in an unstable macroeconomic environment implying that aid unpredictability forces weak governments to be more prudent in managing the limited uncertain resources at their disposal during periods of macro instability. We however find no evidence of different impacts of aid unpredictability during periods of shocks.en_US
dc.identifier.citationWorking Paper No. 226; 2015en_US
dc.identifier.urihttp://ir-library.ku.ac.ke/handle/123456789/13899
dc.language.isoenen_US
dc.publisherAfrican Development Bank Groupen_US
dc.subjectForeign Aiden_US
dc.subjectAid Unpredictabilityen_US
dc.subjectMacroeconomic Policyen_US
dc.subjectEconomic Growthen_US
dc.titleAid unpredictability and Economic Growth in Kenyaen_US
dc.typeWorking Paperen_US
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