Institutions, Economic Growth, and Foreign Aid in Nepal

Aydin Cecen, Linlan Xiao, Santosh Adhikari

Abstract


This paper investigates the dynamics of economic development in Nepal in the context of foreign aid, institutional change, and political instability. A brief historical account of the recent revolutions is provided to highlight the institutional background of the empirical analysis. Taking into account the time series properties of the variables of interest, the econometric analysis demonstrates that contrary to the results of some recent cross-section studies, foreign aid does contribute positively to economic development in Nepal. On the other hand, the estimation results reveal that “human capital” accumulation and political unrest have had little long term effect on per capita income.


Full Text: PDF DOI: 10.5539/ijef.v6n6p84

Creative Commons License
This work is licensed under a Creative Commons Attribution 3.0 License.

International Journal of Economics and Finance  ISSN  1916-971X (Print) ISSN  1916-9728 (Online)

Copyright © Canadian Center of Science and Education

To make sure that you can receive messages from us, please add the 'ccsenet.org' domain to your e-mail 'safe list'. If you do not receive e-mail in your 'inbox', check your 'bulk mail' or 'junk mail' folders.