Growth And Development Flashcards
1
Q
What is tied aid?
A
Aid with conditions attached e.g economical and political reforms
2
Q
What is bilateral aid?
A
Aid given directly form one country to another
3
Q
What is multilateral aid?
A
When countries pay money to an international agency where it is then distributed to countries on the basis of a certain criteria
4
Q
What are the key arguments for aid
A
- filling the savings gap
- reduction in absolute poverty
- providing funds for infrastructure
- improving human capital
- may contribute to increased globalisation and trade
- reduction of world inequality
5
Q
Arguments against aid
A
- dependency culture
- aid may be diverted or lost due to corruption
- no clear evidence that it leads to a reduction in absolute poverty
- distorts market forces and may be a form of economic imperialism in order to gain political influence
- concessional loans will result in an opportunity cost in the repayment of interest
6
Q
What is the UN goal for amount of aid offered by developed countries?
A
0.7% of GDP
7
Q
What is microfinance?
A
Where a banking service mainly in the form of loans is provided to unemployed Low income individuals who would otherwise have no means of gaining financial services. Mainly in order to encourage the opening of businesses
