The department is a lively community that is recognised internationally as one of the top centres for research and teaching in development studies.
Aid, labour market dualism and the risk of Dutch disease in low-income countries
The research will investigate how providing overseas development assistance (ODA) to a low-income country changes the labour market (in particular skilled labour), linking this to Dutch disease and a country’s long-term growth trajectory.
The research centres on four main questions: (i) the resource movement effect: is skilled labour moving into donor-funded activities away from other formal sectors? (ii) the spending effect: is aid driving up wages in the labour market? That is, is someone with comparable qualifications, skills and experience paid the same/more/less in a donor funded vs non-donor funded position? (iii) long-term effects: what are the employment preferences of university students who will soon enter the labour market? and (iv) do the effects above vary based on the level of aid a country receives? A comparison of Liberia and Sierra Leone will be done in an effort to answer the fourth question.