Factors that impact development: Foreign aid and the millennium development goals

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Irwin, Jill
economics; social sciences
thesis / dissertation description
The topic of development in poor countries has recently gained attention and support in part due to the 2000 Millennium Declaration adopted by all United Nations members. Included in the declaration are eight Millennium Development Goals (MDG) which aim at improving global development and are to be achieved by 2015. Due to time restrictions it is important to find effective and efficient ways to improve the issues addressed by the goals. This paper studies foreign aid’s effect on the Millennium Development Goals by using ordinary least squares regression over a time period from 1980 to 2001. This study also investigates the impact of other variables such as education, income, immunizations, physicians, rural areas and trade on the MDGs. While the results of aid’s impact on development are inconclusive, education, immunizations and births attended by a skilled health staff have significant correlations to the level of development in a country. There is little evidence that income, number of physicians, rural inhabitants or openness improve conditions, as measured by the MDGs in poor countries.