English, Article edition: The Potential of Foreign Aid as Insurance Stéphane Pallage; Michel A. Robe; Catherine Bérubé

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Physical Description
  • article
Language
  • English

Edition details

Title
  • The Potential of Foreign Aid as Insurance
Author
  • Stéphane Pallage
  • Michel A. Robe
  • Catherine Bérubé
Physical Description
  • article
Notes
  • RePEc:pal:imfstp:v:53:y:2006:i:3:p:5
  • This paper quantifies the potential of foreign aid as an insurance mechanism against macroeconomic shocks. Within a dynamic model of aid flows between two endowment economies, we show that at least three-fourths of the large welfare costs of macroeconomic fluctuations in poor countries could be alleviated by a simple reallocation of aid flows across time. In developing countries subject to persistent macroeconomic shocks, the resulting welfare improvement is of first-order magnitude. Copyright 2006, International Monetary Fund
  • RePEc:imf:imfstp:v:53:y:2006:i:3:p:5
Language
  • English
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