<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>The main goal of foreign aid should be the support of developing regions; however, due to the rising international requirements on the amount of provided aid, donors start to focus on the benefits aid can bring them as well. Both country-specific and general studies have been conducted to evaluate the return of aid from the donor’s perspective, with the majority of them suggesting that provided aid boosts donor’s exports to the developing countries. As no such analysis exists for the Czech Republic, this paper tries to fill this gap and aims to find out whether there is a positive relationship between the Czech aid and Czech exports. While employing the gravity model of international trade, the study, however, suggests that the Czech aid is not statistically significant for the volume of Czech exports. Unlike other donors, the Czech Republic thus leaves a considerable trade potential arising from the foreign aid untapped. The reasons might be other motives behind the Czech aid (both official and unofficial), poor co-operation of aid and trade policies, or changes in trade patterns.</p>
</abstract>

The main goal of foreign aid should be the support of developing regions; however, due to the rising international requirements on the amount of provided aid, donors start to focus on the benefits aid can bring them as well. Both country-specific and general studies have been conducted to evaluate the return of aid from the donor’s perspective, with the majority of them suggesting that provided aid boosts donor’s exports to the developing countries. As no such analysis exists for the Czech Republic, this paper tries to fill this gap and aims to find out whether there is a positive relationship between the Czech aid and Czech exports. While employing the gravity model of international trade, the study, however, suggests that the Czech aid is not statistically significant for the volume of Czech exports. Unlike other donors, the Czech Republic thus leaves a considerable trade potential arising from the foreign aid untapped. The reasons might be other motives behind the Czech aid (both official and unofficial), poor co-operation of aid and trade policies, or changes in trade patterns.

Effects of Development Aid on Donor’s Exports: A Case of the Czech Republic

Faculty of International Relations, Department of World Economy

Faculty of Informatics and Statistics, Department of Econometrics

Review of Economic Perspectives

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

{"article-title":"Effects of Development Aid on Donor\u2019s Exports: A Case of the Czech Republic"}

The main goal of foreign aid should be the support of developing regions; however, due to the rising international requirements on the amount of provided aid,...

Effects of Development Aid on Donor’s Exports: A Case of the Czech Republic

Published Online: Sep 27, 2022

Page range: 171 - 191

Received: Jun 08, 2021

Accepted: Apr 29, 2022

DOI: https://doi.org/10.2478/revecp-2022-0008

Keywords
Development aid, donors, exports, gravity model, return of aid

© 2022 Gabriela Dufková et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Effects of Development Aid on Donor’s Exports: A Case of the Czech Republic

Published Online: Sep 27, 2022

Page range: 171 - 191

Received: Jun 08, 2021

Accepted: Apr 29, 2022

DOI: https://doi.org/10.2478/revecp-2022-0008

KeywordsDevelopment aid, donors, exports, gravity model, return of aid

© 2022 Gabriela Dufková et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Keywords
Development aid, donors, exports, gravity model, return of aid