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devildoc devildoc
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A year ago
Ji-Soo comes to you and says that he has calculated the average income of countries that get foreign aid and of those that do not. He found that countries that get foreign aid have much lower incomes, and therefore concludes that foreign aid reduces income for countries. What should you say to Ji-Soo about his conclusion?

▸ Since aid can be lost to corruption aid must not be able to help under any circumstance

▸ Correlation does not mean causation. Poor countries are more likely to receive aid because they are poor rather than being poor because they received foreign aid.

▸ The conclusion is correct because he was able to find data to empirically verify his conclusion

▸ Foreign aid creates dependency between countries and their donors and this can make them poorer
Textbook 
Macroeconomics

Macroeconomics


Edition: 3rd
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iffn23iffn23
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A year ago
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