04872oam 22011414 450 991096875040332120250426110100.0978661382716697814623437511462343759978145198935914519893509781283514712128351471097814527023151452702314(CKB)3360000000443644(EBL)3014502(SSID)ssj0000940039(PQKBManifestationID)11479992(PQKBTitleCode)TC0000940039(PQKBWorkID)10946630(PQKB)10352510(OCoLC)694141188(IMF)WPIEE2006145(MiAaPQ)EBC3014502(IMF)WPIEA2006145WPIEA2006145(EXLCZ)99336000000044364420020129d2006 uf 0engur|n|---|||||txtccrAid Volatility and Dutch Disease : Is There a Role for Macroeconomic Policies? /Thierry Tressel, Alessandro Prati1st ed.Washington, D.C. :International Monetary Fund,2006.1 online resource (65 p.)IMF Working Papers"June 2006."9781451864052 1451864051 Includes bibliographical references (p. 59-63).""Contents""; ""I. INTRODUCTION""; ""II. THE MODEL""; ""III. PARTIAL AND GENERAL EQUILIBRIUM EFFECTS OF FOREIGN AID AND MACROECONOMIC POLICY""; ""IV. THE OPTIMAL TIMING OF AID AND MACROECONOMIC POLICY""; ""V. THE EFFECTIVENESS OF MACROECONOMIC POLICIES IN AID-RECEIVING COUNTRIES""; ""VI. CONCLUSIONS""; ""Appendix I. Solution Strategy""; ""Appendix II-a. Managed Float Regimes""; ""Appendix II-b. General Equilibrium Effect of Front-Loading Aid with LBD Externalities""; ""Appendix III. Pseudo First Stage of System GMM Panel Regressions""; ""REFERENCES""This paper studies how macroeconomic policies can help offset two unintended and undesirable features of foreign aid: its volatility and Dutch disease. We present evidence that aid volatility augments trade balance volatility and that foreign aid, with the important exception of years of adverse shocks, depresses exports. We also find that these effects can be mitigated through changes in net domestic assets of the central bank-a variable that reflects both monetary and fiscal policy. To characterize the optimal policy, we develop a general equilibrium model in which the capital account is closed and aid influences productivity growth through positive (public expenditure) and negative (Dutch disease) externalities. In this setting, macroeconomic policies permanently affect real variables and can improve welfare if donors do not distribute foreign aid optimally over time.IMF Working Papers; Working Paper ;No. 2006/145Economic assistanceEconometric modelsEconomic policyEconometric modelsBalance of tradeimfBankingimfBanks and BankingimfCurrencyimfEmpirical Studies of TradeimfExports and ImportsimfExportsimfForeign AidimfForeign aidimfForeign exchange reservesimfForeign ExchangeimfForeign exchangeimfInternational economicsimfInternational reliefimfInternational reservesimfMonetary PolicyimfReal exchange ratesimfTrade balanceimfTrade: GeneralimfUnited StatesimfEconomic assistanceEconometric models.Economic policyEconometric models.Balance of tradeBankingBanks and BankingCurrencyEmpirical Studies of TradeExports and ImportsExportsForeign AidForeign aidForeign exchange reservesForeign ExchangeForeign exchangeInternational economicsInternational reliefInternational reservesMonetary PolicyReal exchange ratesTrade balanceTrade: GeneralTressel Thierry1804345Prati Alessandro120813International Monetary Fund.Research Dept.DcWaIMFBOOK9910968750403321Aid Volatility and Dutch Disease4371113UNINA