Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
7394306 | World Development | 2015 | 15 Pages |
Abstract
This paper investigates how foreign aid inflows moderate bilateral trade-based pressures on the exporting countries' labor rights. Because aid provides additional resources to recipient governments, it reduces the importance aid-recipient governments attach to the preferences of their export partners. Consequently, aid inadvertently moderates the leverage exercised by importing countries on the governments of exporting, developing countries. Our analysis of a panel of 91 aid recipient countries for the period 1985-2002 lends support to the “revenue substitution” hypothesis. When aid levels are low, bilateral trade-based pressures are associated with improved labor rights. As aid levels rise, however, the effect loses significance.
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Economics and Econometrics
Authors
Sijeong Lim, Layna Mosley, Aseem Prakash,