Do authoritarian regimes receive more Chinese development finance than democratic ones? Empirical evidence for Africa

Tobias Broich

#2017-011

This study is part of an emerging literature that aims to shed light on China's development finance activities in Africa using quantitative estimation techniques. This paper empirically investigates whether African authoritarian regimes receive more Chinese development assistance than democratic ones, both in absolute and relative terms. I use three different measures of democracy/autocracy which allows me to check whether my results depend on the specific indicator chosen. The OLS results suggest that Chinese development finance does not systematically flow to more authoritarian countries, controlling for strategic, economic, political, institutional and geographic confounding factors. The results are not driven by the specific democracy indicator used in the analysis. The findings remain virtually unchanged if I reduce the sample to Sub-Saharan Africa only. Furthermore, the results stand up to several robustness checks, including FE, RE and instrumental variable estimation.

Key words: Development Finance, Foreign Aid, China, Africa, Autocracy, Democracy

JEL Classification: F35, H10, O11, O55