Birgit Meyer

Who Benefits from Aid for Trade? Comparing the Effects on Recipient versus Donor Exports

Abstract Recent studies offer an ambiguous picture on the effectiveness of foreign aid in strengthening the export capacity of recipient countries. Moreover, the literature on aid for trade (AfT) has often neglected the fact that exporters in the donor countries may be among the main beneficiaries. We simultaneously estimate and compare the effects of AfT on trade in both directions. We find that AfT increases recipient exports to donors as well as recipient imports from donors. The first effect tends to dominate the latter, which contradicts the sceptical view that donors grant AfT primarily to promote their own export interests.

A New Global Index of Infrastructure: Construction, Rankings and Applications

We construct comprehensive and comparable indices on the most relevant components of economic infrastructure. An unobserved components model is employed to cover the largest possible number of developing and developed countries over the period 1990–2010. We map major findings from the new indices of infrastructure and provide country rankings, which we also compare with subjective assessments of infrastructure in the World Economic Forums Global Competitiveness Report. Finally, we exemplify possible applications related to trade and foreign aid. By overcoming several data limitations, our new global index can help assess the links between infrastructure and economic development more systematically.

Aid for trade: assessing the effects on recipient exports of manufactures and primary commodities to donors and non-donors

Considering that primary commodity dependence continues to be a major problem of various lower income countries, we analyze whether Aid for Trade (AfT) has helped recipient countries upgrade and diversify their exports. Estimating an asymmetric and aggregated gravity model, we find that AfT has been effective in promoting recipient exports of manufactures - whereas the effects on primary commodities are typically insignificant. These findings hold not only for trade relations with donor countries but also in south-south trade with other developing countries.

Does Aid-for-Trade from the North Promote South-South Trade?

Our empirical estimations indicate that Aid for Trade (AfT) granted by OECD donors strengthens the trade relations of recipient countries with other developing countries. By focusing on South–South trade, we mitigate endogeneity concerns that have plagued analyses of trade between recipients and donors of AfT.

Democracies cooperate more: even where it threatens to bite?

ABSTRACT Estimating two-step selection models, we find that more democratic governments are more likely to conclude preferential trade agreements (PTAs) and to agree to stricter investment provisions related to pre-establishment national treatment and investor–state dispute settlement in PTAs. This is surprising when considering the potentially high costs of litigation.