1994 Fiscal Year Final Research Report Summary
Allocation of Japanese Foreign Aid and Its Impact on LDC's
| Project/Area Number |
04620036
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| Research Category |
Grant-in-Aid for General Scientific Research (C)
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| Allocation Type | Single-year Grants |
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| Research Field |
Politics
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| Research Institution | University of the Ryukyus |
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Principal Investigator |
HOSHINO Eiichi University of the Ryukyus, College of Law & Literature, Associate Professor, 法文学部, 助教授 (50229176)
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| Project Period (FY) |
1992 – 1994
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| Keywords | Official Development Aid / ODA / Japanese Foreign Aid / LDC |
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| Research Abstract |
Two issues regarding Japanese foreign aid to developing countries are particularly important. The first is what impact, if any, the aid has on development in reality. Aid should generate at least significant economic growth in the receiving countries. Related to the issue of impact is the question of decision of donor countries to give aid. What factors, aside from those of economic development, are operative here?
The purpose of this project is to examine these two interrelated issues : allocation of Japanese foreign aid and its impact on economic growth and equality in the recipient countries.
When a group of decision makers in a donor country are assumed to be a rational unitary actor, they should take the recipient needs into consideration in allocating their limited resources as foreign economic aid. Since non-superpower donors cannot fine-tune the foreign and/or domestic policies of the recipient government, they have little to gain from giving their resources away to unneedy reciplents. Our examination of Japanese foreign aid shows that decisions in Japan's economic aid allocation are best explained by the community of interests model. When the community of interests model holds, it is not reasonable for policy makers to allocate scarce resources with an expectation of changing other country's domestic or foreign policy behaviors. An appropriate rationale to extend ODA is to support countries or governments with favorable policy stances for Japan by assisting recipient development.
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