Which of the following is true about the relationship between foreign aid and economic development? Most empirical studies have found a positive correlation between aid and economic development The use of instrumental variables has been effective at clearly identifying the causal effect of foreign aid on economic development We do not really know how aid affects development because it is likely that a poor country will get more aid simply because it is poor. In other words, we do not know if aid affects development or if development affects aid. All of these are true

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Comparative Advantage and Absolute Advantage Analysis

The theory of absolute advantage was given by Adam Smith in the year 1776.