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dc.contributor.authorClist, Paul
dc.date.accessioned2016-03-23T14:14:06Z
dc.date.available2016-03-23T14:14:06Z
dc.date.issued2014-09
dc.identifier.citationClist, P. (2014) Foreign Aid and Domestic Taxation: Multiple Sources, One Conclusion. ICTD Working Paper 20. Brighton: IDS.en
dc.identifier.isbn978-1-78118-190-4
dc.identifier.urihttps://opendocs.ids.ac.uk/opendocs/handle/20.500.12413/10251
dc.descriptiondevelopment aid; tax; fiscal response; replication; MIMIC model.en
dc.description.abstractThere are genuine concerns that foreign aid may crowd out domestic tax revenue. In the short run this would have negative consequences for the recipient government's revenue, and over a longer period could corrode governance through breaking the social contract. In recent years, two papers have presented empirical results that suggest while aid loans are free from such concerns, aid grants do crowd out tax revenue. Previous research showed that the results from the first paper, Gupta et al. (2004), did not survive the inclusion of more recent data or a minimal lag on aid variables (a simple way of reducing concerns of endogeneity). This article deals with the second contribution, Benedek et al. (2012), and finds that the results cannot be replicated. Furthermore, they suffer from serious problems resulting from a dependent variable comprised of several incompatible data sources and definitions. A variety of econometric techniques are used, including new data, with the weight of evidence pointing to a modest but positive effect from foreign aid on domestic tax revenue. Fears over a negative effect for aid grants appear unwarranted, and are accounted for by the inappropriate use of data or endogeneity concerns.en
dc.description.sponsorshipDfID, NORADen
dc.language.isoenen
dc.publisherInstitute of Development Studiesen
dc.relation.ispartofseriesICTD Working Paper;20
dc.rightsForeign Aid and Domestic Taxation: Multiple Sources, One Conclusion Paul Clist ICTD Working Paper 20 First published by the Institute of Development Studies in September 2014 © Institute of Development Studies 2014 ISBN: 978-1-78118-190-4 A catalogue record for this publication is available from the British Library. All rights reserved. Reproduction, copy, transmission, or translation of any part of this publication may be made only under the following conditions: – with the prior permission of the publisher; or - with a licence from the Copyright Licensing Agency Ltd., 90 Tottenham Court Road, London W1P 9HE, UK, or from another national licensing agency; or - under the terms set out below. This publication is copyright, but may be reproduced by any method without fee for teaching or nonprofit purposes, but not for resale. Formal permission is required for all such uses, but normally will be granted immediately. For copying in any other circumstances, or for reuse in other publications, or for translation or adaptation, prior written permission must be obtained from the publisher and a fee may be payable. Available from: The International Centre for Tax and Development at the Institute of Development Studies, Brighton BN1 9RE, UK Tel: +44 (0) 1273 606261 Fax: +44 (0) 1273 621202 E-mail: info@ictd.ac.uk Web: www.ictd/en/publicationsen
dc.rights.urihttp://www.ids.ac.uk/files/dmfile/IDSOpenDocsStandardTermsOfUse.pdfen
dc.subjectEconomic Developmenten
dc.titleForeign Aid and Domestic Taxation: Multiple Sources, One Conclusionen
dc.typeIDS Working Paperen
dc.rights.holderInstitute of Development Studiesen
dc.identifier.externalurihttp://www.ictd.ac/ju-download/2-working-papers/13-foreign-aid-and-domestic-taxation-multiple-sources-one-conclusion


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