Date
2014
Dewey
Economie internationale
Sujet
Foreign aid; Firms growth; Infrastructures constraints
JEL code
F.F3.F35; O.O1.O16; O.O5.O50
Conference name
AFSE 2015 64th Congress
Conference date
06-2015
Conference city
Rennes
Conference country
France
Author
Chauvet, Lisa
status unknown
Ehrhart, Hélène
143593 Banque de France
Type
Communication / Conférence
Item number of pages
35
Abstract (EN)
This paper explores the impact of foreign aid on firms growth for a panel of 5,640 firms in 29 developing
countries, 11 of which in Africa. Using the World Bank Enterprise Surveys data and controlling for fi rms
fixed e ffects, we fi nd a positive impact of foreign aid on sales growth. This result is robust to various checks,
notably to the instrumentation of aid. We then identify the main infrastructure obstacles to rms growth and examine whether foreign aid contributes to relaxing those constraints. We nd that electricity and transport are perceived as important constraints which tend to decrease the growth rate of fi rms, as well as the utilization of their productive capacity. Evidence on the impact of aid on infrastructure obstacles
suggests that total aid and aid to the energy sector tend to decrease electricity obstacles. We also show that
transport aid projects, geo-localized at the region level, tend to decrease the transport obstacles.