Skip to Main content Skip to Navigation
New interface
Journal articles

Dynamic aid allocation

Abstract : This paper introduces a framework for studying the optimal dynamic allocation of foreign aid among multiple recipients. We pose the problem as one of weighted global welfare maximization. A donor in the North chooses an optimal path for international transfers, anticipating that consumption and investment decisions will be made by optimizing households in the South, and accounting for limits in the extent to which recipients can effectively absorb aid. We present quantitative results on optimal aid policy by applying our approach to a neoclassical growth model, where the scope for aid-funded growth is determined by the recipients' distance from steady-state.
Document type :
Journal articles
Complete list of metadata
Contributor : Spire Sciences Po Institutional Repository Connect in order to contact the contributor
Submitted on : Thursday, October 21, 2021 - 9:21:55 PM
Last modification on : Friday, August 5, 2022 - 2:49:41 PM
Long-term archiving on: : Saturday, January 22, 2022 - 9:00:54 PM


Publication funded by an institution


Distributed under a Creative Commons Attribution 4.0 International License



Patrick Carter, Fabien Postel-Vinay, Jonathan Temple. Dynamic aid allocation. Journal of International Economics, 2015, 95 (2), pp.291 - 304. ⟨10.1016/j.jinteco.2014.11.005⟩. ⟨hal-03392988⟩



Record views


Files downloads