Abstract
We investigate whether foreign aid from China is prone to political capture in aid-receiving countries. Specifically, we examine whether more Chinese aid is allocated to the birth regions of political leaders, controlling for indicators of need and various fixed effects. We collect data on 117 African leaders' birthplaces and geocode 1650 Chinese development projects across 2969 physical locations in Africa from 2000 to 2012. Our econometric results show that political leaders' birth regions receive substantially larger financial flows from China in the years when they hold power compared to what the same region receives at other times. We find evidence that these biases are a consequence of electoral competition: Chinese aid disproportionately benefits politically privileged regions in country-years when incumbents face upcoming elections and when electoral competitiveness is high. We observe no such pattern of favoritism in the spatial distribution of World Bank development projects.
| Original language | English |
|---|---|
| Pages (from-to) | 44-71 |
| Number of pages | 28 |
| Journal | Journal of Development Economics |
| Volume | 140 |
| DOIs | |
| Publication status | Published - 1 Sep 2019 |
Keywords
- Africa
- aid allocation
- aid on demand
- China
- clientelism
- favoritism
- foreign aid
- georeferenced data
- Official Development Assistance
- patronage
- political capture
- spatial analysis
Cite this
}
African leaders and the geography of China's foreign assistance. / Dreher, Axel; Fuchs, Andreas; Hodler, Roland; Parks, Bradley C.; Raschky, Paul A.; Tierney, Michael J.
In: Journal of Development Economics, Vol. 140, 01.09.2019, p. 44-71.Research output: Contribution to journal › Article › Research › peer-review
TY - JOUR
T1 - African leaders and the geography of China's foreign assistance
AU - Dreher, Axel
AU - Fuchs, Andreas
AU - Hodler, Roland
AU - Parks, Bradley C.
AU - Raschky, Paul A.
AU - Tierney, Michael J.
PY - 2019/9/1
Y1 - 2019/9/1
N2 - We investigate whether foreign aid from China is prone to political capture in aid-receiving countries. Specifically, we examine whether more Chinese aid is allocated to the birth regions of political leaders, controlling for indicators of need and various fixed effects. We collect data on 117 African leaders' birthplaces and geocode 1650 Chinese development projects across 2969 physical locations in Africa from 2000 to 2012. Our econometric results show that political leaders' birth regions receive substantially larger financial flows from China in the years when they hold power compared to what the same region receives at other times. We find evidence that these biases are a consequence of electoral competition: Chinese aid disproportionately benefits politically privileged regions in country-years when incumbents face upcoming elections and when electoral competitiveness is high. We observe no such pattern of favoritism in the spatial distribution of World Bank development projects.
AB - We investigate whether foreign aid from China is prone to political capture in aid-receiving countries. Specifically, we examine whether more Chinese aid is allocated to the birth regions of political leaders, controlling for indicators of need and various fixed effects. We collect data on 117 African leaders' birthplaces and geocode 1650 Chinese development projects across 2969 physical locations in Africa from 2000 to 2012. Our econometric results show that political leaders' birth regions receive substantially larger financial flows from China in the years when they hold power compared to what the same region receives at other times. We find evidence that these biases are a consequence of electoral competition: Chinese aid disproportionately benefits politically privileged regions in country-years when incumbents face upcoming elections and when electoral competitiveness is high. We observe no such pattern of favoritism in the spatial distribution of World Bank development projects.
KW - Africa
KW - aid allocation
KW - aid on demand
KW - China
KW - clientelism
KW - favoritism
KW - foreign aid
KW - georeferenced data
KW - Official Development Assistance
KW - patronage
KW - political capture
KW - spatial analysis
UR - http://www.scopus.com/inward/record.url?scp=85066402412&partnerID=8YFLogxK
U2 - 10.1016/j.jdeveco.2019.04.003
DO - 10.1016/j.jdeveco.2019.04.003
M3 - Article
VL - 140
SP - 44
EP - 71
JO - Journal of Development Economics
JF - Journal of Development Economics
SN - 0304-3878
ER -