Fuel Exports, Aid and Terrorism

Simplice Asongu, Jacinta Nwachukwu

Research output: Contribution to journalArticle

5 Citations (Scopus)
2 Downloads (Pure)

Abstract

Purpose - This study employs interactive quantile regressions to assess the conditional role of foreign aid in reducing the potentially negative effect of terrorism on fuel exports in 78 developing countries for the period 1984-2008.

Design/methodology/approach - Bilateral and multilateral aid indicators are used whereas terrorism includes: domestic, transnational, unclear and total terrorism dynamics. Interactive quantile regressions are used.

Findings - First, with the exception of unclear terrorism, bilateral aid can be used to mitigate the potentially negative effect of terrorism on fuel exports in bottom quintiles of the fuel export distribution. Second, multilateral aid can be used to reduce the negative effect of transnational terrorism on fuel exports exclusively in the highest (90th) quintile of fuel exports. The corresponding modifying thresholds are within policy ranges disclosed in the summary statistics.

Practical implications- While the policy instrument of bilateral aid is most relevant in countries with below-median fuel exports, the policy instrument of multilateral aid is effective with respect to transnational terrorism in countries with the highest levels of fuel exports.

Originality/value –This study contributes to the literature on the role of external flows in reducing the negative externalities of terrorism on development outcomes.
Original languageEnglish
Pages (from-to)239-267
JournalMultinational Business Review
Volume25
Issue number3
DOIs
Publication statusPublished - 2017

Keywords

  • Exports
  • Development
  • Natural Resources
  • Terrorism
  • Foreign Aid

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