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This paper explores the links between development assistance, agricultural output growth and imports in 56 developing economies over the period 1974–1990. The empirical model treats agricultural growth and imports, savings and aid as endogenous. The analysis also accounts for differences in macroeconomic policies. The results show that aid had a positive impact on agricultural growth. A robust relationship exits between aid and agricultural imports consistent with the argument that aid helps industrialized countries through market expansion and strengthened trade ties.
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