interpretation of table

Exercise 3:

Explain statistical tests in the table. The dependent variable is economic growth per capita in developing countries, and lagged values are observations 5 years, 15 years or 25 years prior to the actual calculation of economic growth (at time T). T is a span of years (not specified in the table). Aid is development aid, and non-G1/G2/G3 aid is non-developmental aid (including military expenditures). Discuss briefly, any shortcomings or methodological challenges in the interpretation.

G1 countries: Denmark, Finland, the Netherlands, Norway and Sweden

G2 countries: G1 + Austria, Canada, Ireland, Luxembourg and Switzerland

G3 countries: G1 + Belgium, France, Ireland and the UK

SSA dummy: Sub Saharan dummy

Disregard the variables: Initial income and Initial policy

and Hansen test p-value and AR(1), AR(2) test values.

Note: Table is on next page

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