According to the implications of the Exit, Voice, and Loyalty game in Chapter 6, giving foreign aid to dictatorships is likely to:
A) improve the welfare of the average citizen in these countries and destabilize dictatorial rule.
B) reduce the welfare of the average citizen in these countries and stabilize dictatorial rule.
C) have no effect on the regime's stability.

Question

Quizplus · Accepted Answer

Providing foreign aid to dictatorships creates a revenue source for the regime, enabling it to maintain its power and control over its citizens while reducing the incentives for individuals to use their exit, voice, and loyalty mechanisms. This can lead to decreased welfare for citizens and greater stability for the regime.

According to the Implications of the Exit, Voice, and Loyalty