The Impact Of Foreign Aid On Domestic Saving Investment And Economic Growth The Case Of Ethiopia

The objective of the study is to examine the relationship betweenrnforeign aid and domestic saving investment and economic growth inrnEthiopia for the period 1964/65 to 1998/99. The analysis makes usernof the Johansen maximum likelihood estimation procedure.rnThe main findings are: foreign grant has a negative and significantrnimpact on saving, investment and growth, while foreign loan has arnpositive and significant impact on above mentioned economicrnperformance indicator. Applying the Error Correction MODEL (ECM),rnforeign grant and loan are insignificant through out the model in thernshort-run.

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