Elite Capture of Foreign Aid : Evidence from Offshore Bank Accounts
Do elites capture foreign aid? This paper documents that aid disbursements to highly aid-dependent countries coincide with sharp increases in bank deposits in offshore financial centers known for bank secrecy and private wealth management, but not in other financial centers. The estimates are not confounded by contemporaneous shocks such as civil conflicts, natural disasters, and financial crises, and are robust to instrumenting with predetermined aid commitments. The implied leakage rate is around 7.5 percent at the sample mean and tends to increase with the ratio of aid to GDP. The findings are consistent with aid capture in the most aid-dependent countries.
Date: 24 February 2021, 15:00 (Wednesday, 6th week, Hilary 2021)
Venue: By Zoom
Speaker: Niels Johannesen (University of Copenhagen)
Organising department: Saïd Business School
Organisers: Dr Martin Simmler (Oxford University Centre for Business Taxation), Dr Irem Guceri (Oxford University Centre for Business Taxation)
Organiser contact email address: cbtevents@sbs.ox.ac.uk
Part of: Oxford University Centre for Business Taxation Research Seminars
Booking required?: Required
Booking email: CBTEvents@sbs.ox.ac.uk
Audience: Members of the University only
Editor: Alison Meeson