Abstract (EN)

In this paper we use a simple standard overlapping generations model to assess the impact of foreign aid. Donors are not able to modify the sharing out of aid between old and young in the recipient economy. This assumption is in line with the deference to the elders, which characterises the political systems of many developing countries and the idea that .aid cannot buy the reforms. If aid is considered only as a device to reach the spontaneous steady state of the economy, the impact of aid is an increase of the wellbeing of the recipient economy, but may result in a decrease or an increase of the growth rate of the economy depending on a threshold share of aid accruing to the elders. Conversely, even in this setting, aid may be used as a device to make the economy reach the golden rule steady state.