Aid and Sectoral Labour Productivity
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Aid and Sectoral Labour Productivity. / Selaya, Pablo; Thiele, Rainer .
2008.Research output: Working paper › Research
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TY - UNPB
T1 - Aid and Sectoral Labour Productivity
AU - Selaya, Pablo
AU - Thiele, Rainer
N1 - JEL classification: F35, O47
PY - 2008
Y1 - 2008
N2 - The paper examines empirically the proposition that aid to poor countries is detrimental for external competitiveness, giving rise to Dutch disease type effects. At the aggregate level, aid is found to have a positive effect on growth of labour productivity. A sectoral decomposition shows that the effect is significant and positive both in the tradables and the nontradables sectors. The paper thus finds no empirical support for the hypothesis that aid reduces external competitiveness in developing countries. Possible reasons are the existence of large idle labour capacity and high levels of dollarization in financial liabilities at the firm level.
AB - The paper examines empirically the proposition that aid to poor countries is detrimental for external competitiveness, giving rise to Dutch disease type effects. At the aggregate level, aid is found to have a positive effect on growth of labour productivity. A sectoral decomposition shows that the effect is significant and positive both in the tradables and the nontradables sectors. The paper thus finds no empirical support for the hypothesis that aid reduces external competitiveness in developing countries. Possible reasons are the existence of large idle labour capacity and high levels of dollarization in financial liabilities at the firm level.
M3 - Working paper
BT - Aid and Sectoral Labour Productivity
ER -
ID: 32298541