This study presents a comparative analysis of the relative impact of official developmental assistance/foreign aid (ODA) that was given by the OECD countries to select developing countries of the South (sub-Saharan Africa) during the last decade of the Cold War (1980-1990), and the immediate Post-Cold War period (1990-2002). Firstly, this study seeks to illuminate the specific role of foreign aid and its contributory effect in the economic growth and development of these countries between the two time periods, and secondly, delineates specific institutional and governance problems and how these militate against a more effective application of foreign aid or official development assistance. Findings from the data analysis indicate that ODA had no noticeable effect on economic growth as measured by average annual percentage change in GDP growth. While inflation had a negative effect on annual GDP growth during the last decade of the Cold War, it was relatively inconsequential in the period following the end of the Cold War. Only the human development index had a positive impact on annual GDP growth during the post-Cold War years (1990-2002) –suggesting that sub-Saharan Africa countries would need to develop a more robust institutional capacity and human capital skills as a prerequisite for aid effectiveness.
Kalu, Kalu N.
"Liberal Economics, Governance, and Official Development Assistance: Empirical Comments on Theoretical Themes,"
African Social Science Review: Vol. 5
, Article 4.
Available at: http://digitalcommons.kennesaw.edu/assr/vol5/iss1/4