Question
Read pages 23-30 (the first two sections, not including the one called The Theory of Aid and Economic Growth)of the article Can Foreign Aid Buy
Read pages 23-30 (the first two sections, not including the one called "The Theory of Aid and Economic Growth")of the article "Can Foreign Aid Buy Growth? (link below)" by Bill Easterly, and answer the following questions. Read the note at the end of this questions before attempting your answers.
https://www.dropbox.com/s/k2227b1ebhel126/Easterly_JEP_2003.pdf?dl=0
a. Summarise, in a few words, the main result found in the cited work by Burnside andDollar(2000). [10points]
b. If you had to use the Solow growth model to interpret this result, how would you do it? Crucially, how will you interpret the concept of "good policies" in the Solow growth model? Which parameter do you think will be affected by good policies?Make use of maths and diagrams as you see fit.[10 points]
c. SummariseEasterly's critiques to the result of Burnside and Dollar (2000) based on the alternative results provided by other researchers. [10 points]
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