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1、Thecurrentissueandfulltextarchiveofthisjournalisavailableatwww.emeraldinsight.com/0144-333X.htmIJSSPPovertyreductionandaid:29,5/6cross-countryevidenceMohsenBahmani-OskooeeTheCenterforResearchonInternationalEconomics,264TheUniversityofWisconsin-Milwaukee,Milwaukee,Wisconsin,USA,andMaharoufOyol
2、olaTheUniversityofVermont,Burlington,Vermont,USAAbstractPurpose–Thepurposeofthispaperistoexaminetheimpactofforeignaidonpoverty.PovertyreductionhaslatelybecomeanissueofgreatinterestaftertheadoptionoftheUnitedNationsMillenniumDevelopmentGoalsinwhichtheinternationalcommunityhassetthegoaltohalvep
3、overtyby2015.Design/methodology/approach–Thispaperusespooledtime-seriesandcrosssectionaldatafrom49developingcountries.Findings–Thepaperfindsthatforeignaidiseffectiveinreducingpoverty.Thiscontradictspreviousliterature.Originality/value–Thepaperintroducesforeignaidasanotherdeterminantofpovertyi
4、naregressionmodelandsuggeststhatgrowth-promotingandpoliciesintendedtoreduceinequalityarealsoeffectiveinreducingpoverty.KeywordsEconomicsectors,Socio-economicregions,Internationalaid,PovertyPapertypeResearchpaper1.IntroductionForeignaidhaslatelybecomeanareaofgreatinterestinthedevelopmentlitera
5、tureafterthepublicationoftheinfluentialpaperbyBurnsideandDollar(2000).Apuzzlethathasemergedisthesharpcontrastpertinenttotheeffectivenessofaidinpromotinggrowthanddevelopmentinthepost-wareraindevelopingcountries.Theanalysisoftheeffectivenessofaidhasfocusedmostlyoncomplementaryconditionsrequired
6、tomakeaidachieveitsgoals.BurnsideandDollar(2004)provideempiricalevidencethatforeignaidiseffectiveincountrieswithgoodfiscal,monetaryandtradepolicies.Theseresultshasbeenvehementlychallengedbynumerousscholars,spearheadedbyEasterly(2003),whofindsthatforeignaidisnolongereffectiveincountrieswithgoo
7、deconomicpolicieswhentheoriginaldataareexpanded.Thiscontrastingresultsclearlyhighlightthatmoreworkneedstobedonetoempiricallyassessthetruerelationshipbetweenaidandgrowth.However,BurnsideandDollaridentifyanimportantissue,andthatis,foreignaideff
