Publication

This paper argues that the main reason why Indonesia has performed better than Nigeria in terms of its economic development since the 1960s is because of its greater access to foreign aid. The author contends that due to the availability of foreign aid, Indonesian policy makers were able to finance development in times of economic difficulty and had a greater ability to decide which development programs to undertake. In contrast, Nigeria, which has had only limited foreign aid, had to take out loans in times of economic trouble, further deteriorating its budget.