Misleading Metaphors: Culpable Optimism Concerning Development

A vast literature evaluates the effectiveness of development aid, often reaching sobering conclusions. We argue that a key shortcoming of this literature is the focus on a narrow concept of effectiveness—mostly economic growth—that does not match the kind of effectiveness that aid donors actually aim at. To determine actual donor motives, we first survey the literature on aid allocation and identify a large set of motives that is common to many donors. We then employ this set of donor motives for compiling a survey of the aid effectiveness literature by donor motive. The literature shows that while aid has a moderate effect on economic development at best, it seems effective in achieving many of the other effects primarily intended by aid donors. We conclude by speculating that future research on aid effectiveness will be more likely to identify significant effects of aid when taking donor motives into account.

This article is a theoretical interrogation and appreciation of the relationship that hitherto exists between the dependency theory and donor aid. A number of scholars have heaped aspersions on the relevance of the dependency theory. This article argues that dependency theory is still relevant and has flared in this current epoch. Donor aid has emerged as a symbol of dependency, supporting the argument on the relevance of dependency theory. Donor aid has emerged as a nuanced form of dependency on western countries. Dependency theory, which originated in the 1950s, has Singer and Prebisch as the progenitors— and emerged as a result of the growing dissatisfaction with modernity theories that had propounded that economic growth in developed countries was similarly going to lead to unabated growth and development in poorer countries. The theory is premised on resources being extracted from poorer countries to enrich wealthy nations. The continuation of this scenario has resulted in a situation where poverty has been exacerbated among the poorer nations, while the wealthy nations are becoming richer. . Donor aid has, in a plethora of ways, enriched the rich countries while dialectically impoverishing poor countries. It is not an exaggeration that donor money that is being extended to Third World countries, has created more employment, demand for goods and services in richer countries than in poorer countries, thus perpetuating underdevelopment in the latter. Donor aid has undoubtedly, been used as a rod to whip Third World countries at variance, with self-serving interests. On the other hand, the insatiable desire for aid has forced the poorer countries to submit to the dictates of the richer countries.

For many years donor aid served as a key strategy utilized by wealthier nations to address the global disparities in developing world. Foreign aid was a source of financial resources for economic growth, infrastructure development and, social programs. However, in recent years, the nature of aid has shifted notably becoming an instrument with its far-reaching conditionality. Donor aid shapes policies in receiving states reflecting a more interventionist approach. Many scholars argue that donor aid paradoxically hinders recipient country´s development causing dependency and this dependency is not only economic or financial but also political. The article draws parallels between the dependency theory and donor aid. The dependency theory emerging as opposed to modernity theory in the 1950th goaled to explain underdevelopment in Latin America has maintained its relevance nowadays and re-emerged in academic discourse. In the modern era, donor aid symbolizes the dependency of Global South on Global North. While aimed at poverty reduction and promotion of economic development in recipient nations, donor aid exacerbates issues such corruption, bad governance, mismanagement of natural resources, environmental degradation and constrains their sovereignty benefiting more donor countries rather than recipient ones. Through the cases of two poorest states in Central Asia – Kyrgyzstan and Tajikistan, the article enlightens the relationship between the dependency theory and donor aid with the special attention paid to Chinese enormous grants and loans. The research demonstrates how these two nations, due to limited resources and economic challenges, have heavily become reliant on foreign aid which in some cases hinder their sovereignty, political and economic independence.

This study explored the relationship between foreign aid and economic growth in Nigeria from 1984 to 2017. The Autoregressive Distributed Lag Bounds method to cointegration was employed for this study. The results revealed that foreign aid did not contribute to economic growth in Nigeria. Also, the macroeconomic policy environment did not contribute to economic growth in both the short-run and long-run. Furthermore, the results revealed that the impact of foreign aid on economic growth in Nigeria was contingent on the quality of the macroeconomic policy environment. Hence, the claim that the effectiveness of aid is dependent on the q policy environment was valid for Nigeria. The study, therefore, recommends that the policymakers of the government should put in place a sound macroeconomic policy environment that is stable to stimulate domestic saving and ensure the effective utilization of foreign aid. Besides, there is a need for the diversification of the economy through viable alternatives such as agriculture, industrialization and trade to lessen heavy reliance on foreign aid as a major means of stimulating economic growth. Furthermore, the Economic and Financial Crimes Commission and Independent Corrupt Practices and other Related Offences Commission, established to fight corruption should be effective in their job and convince development partners and other aid donors that it is no longer business as usual for those that divert public resources including foreign aid funds for personal gains and the government should provide incentives to private investors and good enabling environment for the thriving of private businesses.

Based on a 25-country econometric model of NGOs, the authors explain the growth and legal impact of NGOs by disentangling the contributions of economic forces, donor aid and the legal environment in the so-called ‘transition’ economies of Eastern Europe and the Former Soviet Union. They find that while greater civil liberty has had a positive impact on NGO proliferation in the Balkans, it has actually reduced their number in Central Asia. Conversely, NGOs have had a positive impact on many aspects of the legal environment in Eastern Europe and the Western FSU, though not in the Caucasus or Central Asia. Increases in NGO activity, however, have often led to increased corruption (though the inverse has generally not occurred). Donor aid has not had a uniformly positive effect on promoting NGOs: depending on the region, donors and NGOs may act as complements or substitutes for services. Finally, while there are positive income effects on NGO growth, improvements in telecommunications infrastructure have by far a greater impact on NGO activity.

Economy and finance seem to be often associated concepts. Many researchers on over the world are attracted by this relationship. This study evaluates the empirical relationship between the financial development and the economic growth for three Asian economies which have significantly different characteristics: Taiwan, China and Thailand from 1991 to 2010. This study focuses on banking and stock market indicators, which measure financial development and structure, monetary and the degree of international capital mobility in the economic process of Taiwan, China and Thailand. The authors use the annual data from 1991 to 2010 as well as the principal component analysis and linear regression to estimate results. This study provides little support to the view that finance has effect on economic. The authors also reduce gaps found in the literature when applying the theory of the impact of financial development on economic growth to three different economies. Besides, the authors hope to contribute to these countries to find which indicators will be important to economic growth. Then they will have right polices to growth their own economies. This study finds that: the effects of financial development on economic growth in these economies are significantly different. High investment had contributed in Taiwan and China while it may not affect to Thailand. The government consumption and the growth rate of real export had a positive role in economic growth in all these economies. The finance-aggregate, which representative by the banking structure indicators, had a significant positive effect on Taiwan and Thailand; but played a negative role in China causing by the tightly financial policy of Chinese government. The market size seemed not accelerate economic growth. However the stock return would impulse the growth of economy. The two period of financial crisis did not affect the economic growth in Taiwan and China, but it negative strongly impacted on Thailand’s economic growth. Capital outflow could bring back the benefit for Taiwan economy. But capital inflow implied the opposite, while the capital inflow had contributed in China economic growth. This study leads to some interesting implications: the first one relates to the role of financial development in economic growth. This study also proves the theory developed by Schumpeter from 1911 for the effect of financial development on economic growth. Secondly, this study has a contribution when applying to different economies which have strong differently characteristics in both economic and finance or even political system. The authors find that there are significant differently reflects of the impact of financial development on economic growth of Taiwan, China and Thailand. Moreover, as what can be seen in above discussion, the financial crisis will not be a threatening factor to the economic growth in Taiwan and China due to the huge economy of China and the sustainable development of Taiwan’s finance.

In places with a predominantly natural heritage, environmental and development discourses are intertwined and often competing. A key dimension is the social construction of socio-spatial relationships, and particularly, the attribution of core and periphery features. In this article, we investigate environmental and development discourses in the peripheral spatial context of the Aysén region of Chile. Three research questions guide the investigation: (a) What are the dominant environmental and development discourses? (b) what are the main synergies and tensions among discourses? and (c) what are the (discursive) implications for (de-)peripheralization? Based on semistructured interviews and secondary sources, we identify six regional discourses on environment and development. Imaginaries of nature, regional development, and economic growth are the common denominators that create synergies and tensions. We conclude that environmental and development discourses play a key role in the transformation of geographic peripheral areas. Discursive synergies can not only reinforce but also counteract tendencies of peripheralization.

A voluminous literature notwithstanding, a widely shared consensus still needs to be discovered in India's economic growth and development discourses. This study attempted to engage with the extant literature on economic growth and development in India to review them critically. For doing so, the study devised an analytical framework wherein the extant body of literature is dichotomised into conventional and non-conventional narratives. The much-trumpeted rhetoric of either pro-market or anti-market appeared a false dichotomy. Instead, the obtained dichotomy was that of market-complimenting and market-supplementing. Hence, the mainstream debate on economic growth and development in India since independence had never been between orthodox and heterodox economics. The argumentation had always located itself firmly within the orthodoxy of neoclassical economics. We drew two broad conclusions from this review. First, India's economic growth and development analysis appear to be in flux to this day. Moreover, the hegemony of orthodox economics is yet to be challenged in any consequential way. Keywords: Economic planning, economic reforms, economic growth, development, economy. JEL Codes: O40, O53

A voluminous literature notwithstanding, a widely shared consensus still needs to be discovered in India's economic growth and development discourses. This study attempted to engage with the extant literature on economic growth and development in India to review them critically. For doing so, the study devised an analytical framework wherein the extant body of literature is dichotomised into conventional and non-conventional narratives. The much-trumpeted rhetoric of either pro-market or anti-market appeared a false dichotomy. Instead, the obtained dichotomy was that of market-complimenting and market-supplementing. Hence, the mainstream debate on economic growth and development in India since independence had never been between orthodox and heterodox economics. The argumentation had always located itself firmly within the orthodoxy of neoclassical economics. We drew two broad conclusions from this review. First, India's economic growth and development analysis appear to be in flux to this day. Moreover, the hegemony of orthodox economics is yet to be challenged in any consequential way. Keywords: Economic planning, economic reforms, economic growth, development, economy. JEL Codes: O40, O53

Islamic banking and finance has emerged as one component of a significant competitive and comprehensive market, where it is reliable with conventional financial development in term of economic contribution. As of today, Islamic banking accounts for minimum of 11 percent growth in Malaysia economic development and indirectly contributes to the global agenda of developing sustainable growth. Thus, this paper aim to empirically assess the dynamic contribution of Islamic banking towards economic growth in Malaysia based on selected variables, namely, real gross domestic product (GDP), total deposit, total financing, total assets and non – performing loan. The quarterly time – series data from (2007: Q1 – 2014: Q1) are used to uncover short–run and long–run relationship between real GDP and Islamic banking key financial indicators. Using a battery of time series econometric techniques, we document that there is robust evidence suggesting favourable result where Islamic banking does contribute towards economic growth in the long-run where total deposit, total financing and total assets of Islamic banking have positive relationship where non – performing loan is found to have negative relationship. To test the causality relationship of variables in the short-run, the Wald – test Granger Causality has been carried out and it shows that there is evidence of a bidirectional causality relationship between economic growth and total deposit of Islamic banks. In addition, bidirectional relationship is also exists between non-performing loan and total deposit of Islamic banks. However, majority of the variables are found to be having unidirectional causality relationship among the variables. Overall, our conclusion state that Islamic banking and finance still act as one of the dominant key contributor to Malaysian economic development and growth. The results obtained in this paper are much more robust to alternative econometric specifications.

The relationship between the financial system (specifically stock market development) and economic growth has been an important issue of debate. A well-functioning financial system can affect economic growth through the improvement of capital productivity and the efficient allocation of resources. The role of taxation as a major determinant of an active financial system and strong economic growth also becomes of interest to the researcher. Taxation through policy and revenue collection seems to play a pivotal role in fostering economic growth and promoting the financial system. However, both taxation and the financial system jointly affect economic growth performance. In this respect, not many empirical studies have been devoted to observing this issue and none exist for Asian economies. Thus, the main objective of this study is to empirically examine the impact of both the financial system and taxation on economic growth performance in the Malaysian context for the period of 1980-2008. As an introduction, Chapter 1 provides the background, motivation and outline of this thesis. Chapter 2 then provides an overview of the Malaysian economy throughout the study period. In this chapter, the performance of all the key macroeconomic indicators that have been used in this study are highlighted. Chapter 3 provides a survey of the relevant literature and discusses the motivations behind the development of the key research questions addressed in Chapters 4 through 6. Chapter 4 focuses on the examination of the nexus between taxation revenue and the financial system. The main objective here is to identify the nature of the relationship between taxation revenue and the financial system – does taxation matter for financial system activities or does the financial system contribute to high revenue collection. In this chapter, we analyse the relationship in the multivariate model applying Autoregressive Distributed Lag utilising the monthly data for direct taxation, the Kuala Lumpur Composite Index (stock market proxy), investment bank loans to the private sector, commercial bank loans to the private sector, and the outstanding private sector bond market for the period of 1997 to 2008. From the analysis conducted, no significant results are reported for the stock market variable, however, investment bank credit negatively affects the revenue collection. While chapter 4 provides novel evidence on the nexus between the financial system and taxation in Malaysia, our empirical work can also be viewed as addressing the issue of whether the existing government policy is capable of explaining the influence on the financial system performance in Malaysia. Chapter 5 employs the Vector Error Correction model and variance decomposition analysis to explain the impact of both the stock market and taxation on the economic growth performance of Malaysia over the common sample period of 1980 to 2008. Consistent with Levine’s (1991) endogenous growth model, we found that taxation and the stock market jointly affect the growth rate. However, these results were only found in the short-run while in the long-rung we failed to identify any significant results concerning the impact of the financial system and taxation on economic growth. While in Chapter 5 we found that the financial system and taxation does matter for economic growth in the Malaysian context in the short-run, in Chapter 6 we then expand our analysis to cover ten developing Asia countries – Bangladesh, China, India, Indonesia, Malaysia, Pakistan, the Philippines, Sri Lanka, Taiwan, and Thailand – utilizing monthly data from 1990 to 2008. In this analysis we conduct panel unit roots, panel cointegration, and panel Granger causality tests to see the nature of the relationship. The panel analysis results reveal that while tax revenue does not matter for economic growth, the stock market does play a pivotal role in determining short-run growth performance in the Asian region. Chapter 7 summarizes the key findings of this thesis along with some recommendations for future research. We finally conclude this thesis by offering some general guidelines, which might be useful for future empirical research on the nexus between the financial system, taxation and economic growth.

The trade openness is one of the most important determinants of a country’s relative level of economic health. It plays a vital role for most free market economies in the world. This research is an attempt to investigate, particularly, the impact of the trade openness on the economic growth in Niger; and generally, the relationship between all the variables under study. Four (4) variables namely real economic growth rate represented by real gross domestic product growth rate (GDPGR), trade openness (TRDOP), real exchange rate (REEXR) and foreign direct investment (FDI) have been considered in the model. The paper used time series data covering the period from 1980 to 2013 as well as time series methods for the econometric analyses. The results show that there exists a long term relationship between all the variables; the independent variables affects the economic growth in the short-run; only the trade openness and the real exchange rate influence economic growth unidirectionally; except foreign direct investment (FDI), all the variables have explanatory power on economic growth in Niger. The implication of this study is that the trade openness has been efficient to spur the economic growth in Niger over the period of study. Therefore, it is a key indicator which the government should care about.

It is widely recognized that trade and foreign direct investment (FDI) inflows are important factors in long-term economic growth. Trade openness enhances skills through the adoption of imported superior production technology and innovative processes, and thus exerts a positive and significant impact on economic growth. Similarly, FDI augments and stimulates domestic investment, enhances technology transfer, increases export capacity and foreign exchange earnings, and thus promotes capital formation and long-run growth. This paper examined the empirical relationship between economic growth on one hand and trade and FDI flows on the other hand for Saudi Arabia during the last four decades (1970-2010). The autoregressive distributed lag (ARDL) methods to cointegration and the associated error correction model (ECM) are adopted. The results suggest that human capital, government expenditure, trade openness and infrastructure are important determinants of long run growth in Saudi Arabia. In contrast, FDI together with domestic private investment has impacted negatively on real gross domestic product (GDP). This is attributed partly to the dominant role of the public sector in the economy emanating from the huge oil resources, thereby leaving little room for the domestic and foreign private investment to play their role in the economy, and partly to the concentration of FDI in unproductive sectors. Nonetheless, the interaction of FDI either with government expenditure or with domestic investment could impact positively on growth. Efforts should therefore focus on enhancing the integration between these factors on long-term growth. Privatization, economic liberalization, and diversification measures are expected to provide real opportunities for domestic and foreign investment to play an important role in economic activity and growth. Key words: Saudi Arabia, FDI, unit roots, ARDL cointegration, ECM, trade.

This thesis analyses the role race and processes of racialisation play in British development discourse about India between 1997 and 2017. Using Stuart Hall’s conceptualisation of race, paired with critical race scholarship, decolonial theory, postcolonial theory and Gramscian notions of hegemony, it offers original empirical findings by examining and comparing three key areas: a) government discourse on development; b) development professionals’ views of their work and c) British newspaper reporting on development in India. The processes of racialisation present in each, and how they interact with colonial tropes, gender and class are evaluated qualitatively and comparatively. They are also compared with domestic discourses already established as racialised, that is discourses on race and asylum and immigration. I demonstrate continuities across these different realms, and identify significant similarities between the arguments of ‘pro’ and ‘anti’ development proponents in British politics. It is by looking at these multiple strands of discourse, articulated at times by different actors, that I suggest racialised development discourse is hegemonic. This thesis offers an original contribution in examining how shifting forms of racialisation operate in development discourse and by arguing that dominant development discourse is key to maintaining and is also maintained by representations of Britishness that are synonymous with whiteness. In addition, it not only demonstrates how race is central to ideas of development but also how this can be masked through competing forms of racialisation of the ‘to-be-developed’ and seemingly ‘positive’ forms of racialisation of people in India.

Economic growth is one of the goals of national development. The decentralization policy implemented Indonesia currently provides opportunity for each region to develop the potential of the area, so that each region is able to achieve an economic growth rate that make walfare for community analysis used in this paper is a multiple linear regression with panel data (pooling data) 9 (nine) districts in Bali Province 2009-2015. Year period of data analysis showed that Pendapan Asli Daerah and Dana Perimbangan affect the economic growth of the district in the province of Bali. Pedapatan Asli Daerah (PAD) and a real positive influence on economic growth district in Bali Province, Dana Perimbangan partially negatively affect economic growth in the district in the province of Bali during the period from 2009 - 2015 increased economic growth in an era of fiscal decentralization have not fully followed by the distribution of economic growth districs in Bali Province. This is evidenced by the Williamson index value stood at 0,687, which means there is still inequality regional GDP per capita among districts in Bali Province. Still there is an imbalance between districts shows that the achievement of development objectives are not yet capable of prospering society.