Competition for aid and trade policy
Description
This paper considers the optimal allocation of a given amount of foreign aid between two recipient countries. It is shown that, given consumer preferences, a country following a more restrictive trade policy would receive a smaller share of the aid if the donor country maximises its own welfare in allocating aid. If, on the other hand, the donor country allocates aid in order to maximize the sum of the welfare of the two recipient countries, the result is just the opposite. Finally, we analyze the situation where the recipient countries compete with each other for the given amount of aid. It is shown that this competition tends to lower the level of optimal tariffs in the recipient countries.
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ID Code: | 94013 | ||
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Item Type: | Contribution to Journal (Journal Article) | ||
Refereed: | Yes | ||
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ISSN: | 0022-1996 | ||
Pure ID: | 60185961 | ||
Divisions: | Past > QUT Faculties & Divisions > QUT Business School Current > Schools > School of Economics & Finance |
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Copyright Owner: | Copyright 1997 Elsevier BV | ||
Copyright Statement: | This work is covered by copyright. Unless the document is being made available under a Creative Commons Licence, you must assume that re-use is limited to personal use and that permission from the copyright owner must be obtained for all other uses. If the document is available under a Creative Commons License (or other specified license) then refer to the Licence for details of permitted re-use. It is a condition of access that users recognise and abide by the legal requirements associated with these rights. If you believe that this work infringes copyright please provide details by email to qut.copyright@qut.edu.au | ||
Deposited On: | 22 Mar 2016 04:50 | ||
Last Modified: | 29 May 2024 14:29 |
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