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This study aims to examine how aid for trade policy and regulations (AfTPR) contribute to achieving Sustainable Development Goal (SDG) target 8.1 (sustain per capita economic growth) and whether the effectiveness of AfTPR is conditional to the stable political environment.

This paper uses a widely accepted endogenous growth framework and applies panel data fixed effects and two-step difference and system generalized method of moments estimation strategies on panel data of 50 developing countries over 2005–2017.

The findings of the study confirm that aid to trade policy promotes sustainable economic growth in developing countries, but this category of development assistance is only effective and significant for low and lower middle-income (LLMI) economies. The positive and significant effect of AfTPR in upper middle-income countries is conditional to their level of political stability. Under a stable political situation, the positive effect of AfTPR on sustainable growth remains almost same for the LLMI countries, whereas for the upper middle-income countries this growth effect reached almost double.

International trade is considered as a driver for inclusive and sustainable economic growth, whereas aid for trade is acknowledged for its prospective contribution toward achieving these goals. The findings have dominant policy implications for the international development organizations and donors, which recommend that it is more desirable to transmit aid toward developing and implementing trade policy and regulations as per capita economic growth improves in the aid recipient countries.

According to the authors’ knowledge, no prior study empirically analyzes the effect of AfTPRs on SDG target 8.1.

Adjustment to a post‐Doha trading regime will be disproportionately costly and difficult for developing countries. Increased aid is vital for the poor countries if they are to grasp the opportunities provided through trade and meet transition costs. With aid‐for‐trade, for the first time, the developed countries have another bound and meaningful commitment that they can offer developing countries. Our proposal to provide new resources to meet adjustment needs, however, does not suggest that trade, when combined with aid, will be a panacea for developing countries. Interactions between trade, aid, and broader development policies and reforms are important.

The movement of profit‐orientated corporations into the fair trade value chain has caused some socially orientated fair trade organizations to question the direction the movement is taking. One organization at the forefront of the debate is Trade Aid (NZ), Inc. (hereafter Trade Aid), a New Zealand based socially orientated fair trade organization actively engaged in fair trade since the 1970s. This paper seeks to evaluate how Trade Aid is seeking to reformulate fair trade's vision of empowerment and partnership constructively.

A single case study approach is undertaken to examine how a socially orientated organization is adhering to and seeking to advance fair trade values. This research draws from the global value chain literature, which analyses how industries are governed. The relational co‐ordination or governance mode, which is characteristic of mutual dependency between supplier and buyer firms, is used as a framework for investigating the fair trade industry. Distinction is made between the corporate and social economy variants of the relational governance mode.

Trade Aid's commitment to producer groups is demonstrated through various initiatives the organization is undertaking as they work both with producer groups and corporate actors to expand the fair trade market. Trade Aid is part of a worldwide socially orientated movement seeking to reformulate the vision of fair trade.

To date the fair trade literature has largely focused on socially orientated fair trade organizations in the Northern hemisphere. This research contributes to a gap in the literature in that it examines Trade Aid and the way this organization is addressing mainstreaming.

This study examines the impact of China’s trade, aid and foreign direct investment (FDI) on the economic growth of Africa.

Our study covered 41 countries in Africa, cutting across the western, eastern, central, southern and northern sub-regions. The study adopted the dynamic system generalized method of moments (SGMM), feasible generalized least squares (FGLS) and Dumitrescu–Hurlin Panel Granger causality techniques for estimations.

Overall, FDI, trade and aid from China have a nonlinear relationship with Africa’s economic growth. The findings reveal a key novelty in that the marginal effect on real per capita GDP increases when China’s FDI interacts with the manufacturing sector in Africa. These findings are robust to long-run estimations.

Given that we have examined the short-and long-run symbiotic effects of China’s FDI and Africa’s manufacturing sector and China’s aid and Africa’s manufacturing sector, more studies are warranted in this area, particularly to produce further empirical evidence of these findings. Moreover, future work could focus on investigating the country-specific effects of China’s trade, China’s FDI and China’s aid on real GDP per capita in each African country as our results reflect within-country elasticities.

This study provides new evidence on the impact of China’s trade, aid and FDI on the growth of African economies. To the best of our knowledge, this is the first study to empirically explore the long-run effects of China’s trade, FDI and aid on economic growth in African countries. This study also tests the claim of the displacement of Africa’s manufacturing industry by its Chinese counterparts.

The existing literature on aid for trade (AfT) tends to support the effectiveness of AfT in improving trade capacities and enhancing the export performance of recipient countries. While aid directed at trade-related infrastructure (e.g. ports and roads) is reported to drive the overall effect of AfT, the increasing importance of labor market flexibility and informal labor in export environment has been largely overlooked. The purpose of this paper is to test two hypotheses regarding the relationship between labor market flexibility, exports and AfT. First, flexible labor regulation promotes exports by reducing adjustment costs related to the export process. Second, for informal labor-intensive export sectors, AfT effectiveness may be compromised by the contraction of the informal sector due to labor deregulation as it deteriorates comparative advantage that supports recipients’ export competitiveness.

Since first introduced by Tinbergen (1962), the gravity model has been widely used to analyze bilateral trade, and its usefulness has been verified in several prominent empirical studies (e.g. Anderson and van Wincoop, 2003; Helpman et al., 2008). However, despite the empirically successful framework of the gravity model, the standard gravity equation may not be appropriate for estimating the effect of AfT in the paper. The main interest lies in whether aggregate AfT flows enhance the export “performance” of individual recipients, that is, whether they improve the recipients’ total exports rather than their bilateral exports. For this purpose, the authors took aggregated approach to the gravity model from Anderson and van Wincoop (2003).

The findings suggest that while both AfT and labor market flexibility are positively associated with higher export levels, the export-promoting effect of AfT is marginally reduced by the contraction of informal workforce. These findings, however, only hold for export sectors that heavily rely on informal labor force, that is, primary commodities and resource/labor-intensive goods. The authors also find that these effects are stronger in low-income countries, indicating that the AfT initiative has been effective where it is needed the most.

This paper is the first attempt to analyze the relationship between AfT and exports with consideration of labor market flexibility. Using the data for 85 recipient countries, the authors test the following hypotheses. First, labor market flexibility promotes exports by reducing adjustment costs related to the exporting process. Second, the contraction of the informal sector due to labor deregulation deteriorates developing countries’ comparative advantage in certain export sectors. Hence, while both AfT and labor market flexibility are expected to enhance the export volume of developing countries, the loss from weaker comparative advantage in a form of smaller informal labor force can exceed the gains from AfT in certain sectors.

The purpose of this study is to investigate whether aggregate and sectoral disbursement of aid for trade (AfT) facilitates achieving gender equality and women empowerment in aid-recipient developing countries for the period 2005–2019.

The study develops static and dynamic panel data and empirical specifications and employs fixed effects and generalised method of moments (GMM) estimation techniques to estimate the impact of aggregate AfT and different categories of AfT on women empowerment. The study uses the Gender Inequality Index (GII) and Global Gender Gap Index (GGI) as the proxy measures of SDG-5, where the higher (lower) value of GII (GGI) implies higher gender disparities and lower women empowerment, and vice versa.

The study finds that aggregate AfT and aid disbursement for the development of economic infrastructure, productive capability building and trade policy and regulations contribute significantly to achieve women empowerment by reducing gender inequalities concerning the labour force and political participation, education enrolment and better healthcare and by increasing gender gap index in relation to economic participation, educational attainment, health and survival and political empowerment. The impact of aggregate AfT and its different categories is found significant only in low- and lower-middle-income developing countries. The findings also indicate that the impact of AfT is not noticeably different across different regions of the world as well as the religious belief of the developing countries.

The study recommends that more allocation of gender-responsive AfT, whether aggregated or disaggregated, significantly helps women empowerment and assists developing economies to achieve SDG-5.

This study is one of the few that investigate the impact of aggregate AfT on gender inequality and women empowerment. This is the foremost study that examines the effects of each individual category of AfT on women empowerment vis-à-vis SDG-5.

The purpose of this paper is to present a review of empirical evidence on the effectiveness of Aid for Trade (AfT) inflows and recommend new areas of interest concerning the initiative other than its effect on trade performance.

This paper reviews a sample of 55 studies over the past 11 years. Besides, this paper categorised the reviewed empirical studies into three groups: the works concentrating on the trade performance effect; the works focusing on other economic factors effect; and the works concerning the allocation effect of these inflows. This paper also offers a detailed analysis of the multiple empirical methods, sources of data, coverage of the countries and forms of AfT inflows used in the reviewed literature.

Key findings indicated that AfT has overall produced a successful impact as reported by most studies. Moreover, it has been highlighted that the effectiveness of AfT may differ relying on multiple indicators: the category of AfT disbursements; income of the recipient country; the recipient country's geographical region; the amount of aggregate AfT as well as its main categories; the policy regulation and institutional quality of the recipient country; and the degree of liberalisation in the recipient country.

This paper is special in that it is the first to publish a comprehensive narrative analysis of 55 empirical pieces of evidence on the effectiveness of AfT over the past 11 years. It is also the first paper to review the previous literature regarding the effectiveness of AfT inflows on other non-trade outcomes, as well as trade outcomes in one single study. The outcome of the survey reveals new areas of interest in the effectiveness of AfT aside from trade performance.

This paper aims to analyse empirically the association between flows of foreign direct investment (FDI), net official development assistance (ODA) inflows and trade-related illicit financial outflows.

With this purpose, a linear model was estimated, using different panel-data estimators, and using a database for a sample of 49 countries spanning the period 2008–2017. The used measure of illicit financial outflows was based on the estimates by Global Financial Integrity of deliberate misinvoicing in merchandise trade.

Research findings show a significant and positive association between changes in both relative lagged net FDI flows and relative FDI outflows (as % of gross domestic product) and changes in the ratio of trade-related illicit capital outflows to total trade. However, these positive associations were only observed in the case of low-income countries. Also, the positive association of net ODA inflows on the IFFT outflows were restricted to the cluster of lower-middle-income countries.

To the best of the authors’ knowledge, this is one of the first studies to empirically estimate the association between FDI and ODA flows and trade misinvoicing at a macroeconomic level. Research findings may contribute to substantiate the concerns expressed in previous research about the potential unintended effects of aid on illicit capital flight in the case of lower-middle-income countries. They also shown that FDI flows could be an additional conduit for trade-related illicit financial flows in these countries