Nexus between Foreign Aid and Economic Growth: Evidences from Bangladesh

Basharat Hossain

Nexus between Foreign Aid and Economic Growth: Evidences from Bangladesh

Basharat Hossain * §

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§ International Islamic University Chittagong

Nexus between Foreign Aid and Economic Growth: Evidences from Bangladesh

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Abstract

Bangladesh receives about $56.5 billion foreign aid during 1971-2012 periods. This paper analyzes 33 years data for 1980-2012 periods to show the effects of foreign aid on the economic growth of Bangladesh. This study estimates eight models including three for last three decades (1980-1990, 1991-2001, 2002-2012), four for the four different government periods, namely, Military government period (1982)(1983)(1984)(1985)(1986)(1987)(1988)(1989)(1990), BNP (Bangladesh Nationalist Party) government (1991)(1992)(1993)(1994)(1995)(2002)(2003)(2004)(2005)(2006) , BAL (Bangladesh Awami League) government (1996)(1997)(1998)(1999)(2000)(2001)(2009)(2010)(2011)(2012) and the Whole Democratic government period and one for entire period . This research finds that, foreign aid has positive effect on the economic growth of Bangladesh and it is statistically significant in two models. The contribution of aid to GDP is falling overtime. This paper also reveals that the aid generates decreasing returns because of capacity constraint of Bangladeshi institutions to utilize foreign aid effectively. This finding is consistent with previous findings of different researches.

References

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Funding

No external funding was declared for this work.

Conflict of Interest

The authors declare no conflict of interest.

Ethical Approval

No ethics committee approval was required for this article type.

Data Availability

Not applicable for this article.

How to Cite This Article

Basharat Hossain. 2014. "Nexus between Foreign Aid and Economic Growth: Evidences from Bangladesh". Global Journal of Management and Business Research, Global Journal of Management and Business Research - B: Economic & Commerce GJMBR-B Volume 14 (GJMBR Volume 14 Issue B6).

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Journal Specifications

Crossref Journal DOI 10.17406/GJMBR

Print ISSN 0975-5853

e-ISSN 2249-4588

Keywords

Bangladesh Economic Growth Effect foreign aid Government

Classification

GJMBR-B Classification JEL Code: F43

P49

Submission ReceivedDecember 13, 2013
Peer Review Double Blind
Handling Editor
Accepted December 31, 2013
Published January 15, 2014

Version of record

v1.2

Issue date

October 6, 2014

Language

English

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Total Score: 148

Country: Bangladesh

Subject: Global Journal of Management and Business Research

Authors: Basharat Hossain (PhD/Dr. count: 0)

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