Struggle for Sway : Chinese aid as determinant of World Bank aid allocations in sub-Saharan Africa

Abstract

This paper examines the effects from Chinese development aid on World Bank project approval ratios and World Bank aid disbursements to countries in Sub-Saharan Africa. The increased Chinese presence in Sub-Saharan Africa may trigger a US response in the form of World Bank aid allocations. I put this theoretical argument to an empirical test on a panel of 43 Sub-Saharan countries covering the period from 2004 to 2012. I find World Bank development aid to be increasing as an effect of Chinese aid receipts, while no effect is found from Chinese aid on World Bank project approval ratios.