Foreign Aid, Trade, and Growth in MENA, Africa, and South Asia: An Analysis of Nonlinear and Conditional Effects
This study utilizes a System-GMM framework to demonstrate that foreign aid fosters sustained economic growth in MENA, Africa, and South Asia only when recipient economies possess sufficient absorptive capacity—such as infrastructure and macroeconomic stability—and when aid is effectively coordinated with trade and investment strategies rather than undermining them.