The politics of foreign aid: A median voter perspective

Mayer, Wolfgang & Raimondos-Møller, Pascalis (2003) The politics of foreign aid: A median voter perspective. Review of Development Economics, 7(2), pp. 165-178.

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The paper presents a model where the median voter in the donor country determines the support of foreign aid. It is first established that an individual in the donor country is affected by the direct benefits (due to altruism) and costs (due to taxes) of giving aid, and by the indirect benefits or costs of a change in the terms of trade. Then it is shown that the latter effect works through changing both the donor country's average income and its distribution of income. Given the stylized facts of a capital-abundant donor country and relatively capital-poor median voter, it is shown how redistribution-of-income effects soften the impact of terms-of-trade changes on the political support for foreign aid.

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ID Code: 94031
Item Type: Journal Article
Refereed: Yes
DOI: 10.1111/1467-9361.00183
ISSN: 1467-9361
Divisions: Current > QUT Faculties and Divisions > QUT Business School
Current > Schools > School of Economics & Finance
Copyright Owner: Copyright 2003 Blackwell Publishing Ltd
Deposited On: 22 Mar 2016 02:13
Last Modified: 22 Mar 2016 02:13

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