CHAPTER 15 Growth Impact of Aid Quantity and Quality in Africa Evelyn Wamboye and Kiril Tochkov INTRODUCTION Foreign aid has been the main avenue for providing development assistance to low- and middle-income countries for over 50 years. While some rapidly growing emerging economies have turned from recipients to donors over the past decade, foreign aid remains a major source of external financing for most developing countries. Its primary objective is to promote growth and development by providing financial assistance to countries with a weak domestic capital base and low levels of foreign direct investment. However, the amounts necessary to stimulate growth as well as the effectiveness of foreign aid have long been the subject of a vigorous debate. Some empirical studies have shown that foreign aid exhibits growth- enhancing effects (Hansen and Tarp 2000; Karras 2006; Loxley and Sackey 2008; Minoiu and Reddy 2009; Moreira 2005), providing support for the argument that current flows of development assistance (henceforth, aid) are insufficient and need to be increased, especially to countries in sub-Saharan Africa (IMF and World Bank 2005; UNDP 2005; Marysee et al. 2007). Other works have found that aid is either neutral (Boone 1996; Easterly E. Wamboye (*) Pennsylvania State University, DuBois, PA, USA K. Tochkov Texas Christian University, Fort Worth, TX, USA 325 © The Author(s) 2017 E. Wamboye, E.A. Tiruneh (eds.), Foreign Capital Flows and Economic Development in Africa, DOI 10.1057/978-1-137-53496-5_15