Scared to Give? A Look into how Terrorism Affects the Flow of Foreign Aid

This thesis examines the role of formal ties to terrorism and its effect on foreign aidfrom donor countries considered either democratic or not. I hypothesize that as more seats are occupied in a recipient country’s government by a known terrorist organization, the less total aid democratic donor countries will send to that country (vice versa for non-democratic donors). However, with stronger ties to terrorism, the more aid democratic donors will bypass through NGOs (vice versa for non-democratic donors). To test this, I used Hezbollah’s seats in Lebanon’s Parliament from the years 1995 – 2021 as a case study for these two hypotheses. After examining four different OLS Regression tables, I found that democratic countries actually bypassed less aid as Hezbollah’s seats in the Lebanese Parliament increased. There were also some interesting results present in either democratic countries or non-democratic countries in terms of domestic variables within Lebanon such as GDP per capita and Lebanon’s population. These results may give some further clarity as to why countries give foreign aid or how countries with different political systems decide to allocate aid to certain countries.