Author : Aaron Batten
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (137 download)
Book Synopsis Foreign Aid, Government Behaviour, and Fiscal Policy in Papua New Guinea by : Aaron Batten
Download or read book Foreign Aid, Government Behaviour, and Fiscal Policy in Papua New Guinea written by Aaron Batten and published by . This book was released on 2010 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The paper explores a number of long standing questions surrounding how foreign aid has influenced the fiscal behaviour of the PNG Government. This includes whether grant aid has encouraged the PNG government to be less fiscally responsible and accumulate higher levels of foreign debt; whether grant aid has tended to lower the PNG government's domestic revenue raising efforts; whether grant aid has drawn government expenditures away from key service delivery sectors; and whether budget support and project and program aid have had differential effects with respect to any of the foregoing questions. The analysis reveals several important insights regarding the interplay between foreign aid and public sector fiscal behaviour including evidence that grant aid has been an important source of debt reduction during this period. However, grant aid has tended to erode the domestic tax base, which has limited the government's ability to increase aggregate expenditure levels. Evidence is also found that suggests a significant portion of budget support was spent on key development sectors, although it also undermined domestic revenue collection. A number of policy implications follow.