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Randall W. Stone - One of the best experts on this subject based on the ideXlab platform.
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Mixed Signals: IMF Lending and Capital Markets
British Journal of Political Science, 2015Co-Authors: Terrence L. Chapman, Songying Fang, Randall W. StoneAbstract:The effect of new International Monetary Fund (IMF) Lending announcements on capital markets depends on the lender’s political motivations. There are conditions under which Lending reduces the risk of a deepening crisis and the risk premium demanded by market actors. Yet the political interests that make lenders willing to lend may weaken the credibility of commitments to reform, and the act of accepting an agreement reveals unfavorable information about the state of the borrower’s economy. The net ‘catalytic’ effect on the price of private borrowing depends on whether these effects dominate the beneficial effects of the liquidity the loan provides. Decomposing the contradictory effects of crisis Lending provides an explanation for the discrepant empirical findings in the literature about market reactions. This study tests the implications of the theory by examining how sovereign bond yields are affected by IMF program announcements, loan size, the scope of conditions attached to loans and measures of the geopolitical interests of the United States, a key IMF principal.
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The Political Economy of IMF Lending in Africa
American Political Science Review, 2004Co-Authors: Randall W. StoneAbstract:Why has IMF Lending achieved such poor results in Africa? Is it because the Fund imposes the wrong conditions, or because it fails to enforce them? Analysis of monthly data on 53 African countries from 1990 to 2000 shows that the IMF's loans-for-reform contract lacks credibility because donor countries intervene to prevent rigorous enforcement. Countries that have influence with developed-country patrons—as measured by U.S. foreign aid, membership in postcolonial international institutions, and voting profiles in the UN—are subject to less rigorous enforcement (shorter program suspensions). They have more frequent program suspensions, because they violate their conditions more often. The IMF will have to become more independent in order to become an effective champion of reform.
Sanjay Basu - One of the best experts on this subject based on the ideXlab platform.
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International monetary fund programs and tuberculosis outcomes in post-communist countries
PLoS Medicine, 2008Co-Authors: David Stuckler, Lawrence P. King, Sanjay BasuAbstract:BACKGROUND: Previous studies have indicated that International Monetary Fund (IMF) economic programs have influenced health-care infrastructure in recipient countries. The post-communist Eastern European and former Soviet Union countries experienced relatively similar political and economic changes over the past two decades, and participated in IMF programs of varying size and duration. We empirically examine how IMF programs related to changes in tuberculosis incidence, prevalence, and mortality rates among these countries.\n\nMETHODS AND FINDINGS: We performed multivariate regression of two decades of tuberculosis incidence, prevalence, and mortality data against variables potentially influencing tuberculosis program outcomes in 21 post-communist countries for which comparative data are available. After correcting for confounding variables, as well as potential detection, selection, and ecological biases, we observed that participating in an IMF program was associated with increased tuberculosis incidence, prevalence, and mortality rates by 13.9%, 13.2%, and 16.6%, respectively. Each additional year of participation in an IMF program was associated with increased tuberculosis mortality rates by 4.1%, and each 1% increase in IMF Lending was associated with increased tuberculosis mortality rates by 0.9%. On the other hand, we estimated a decrease in tuberculosis mortality rates of 30.7% (95% confidence interval, 18.3% to 49.5%) associated with exiting the IMF programs. IMF Lending did not appear to be a response to worsened health outcomes; rather, it appeared to be a precipitant of such outcomes (Granger- and Sims-causality tests), even after controlling for potential political, socioeconomic, demographic, and health-related confounders. In contrast, non-IMF Lending programs were connected with decreased tuberculosis mortality rates (-7.6%, 95% confidence interval, -1.0% to -14.1%). The associations observed between tuberculosis mortality and IMF programs were similar to those observed when evaluating the impact of IMF programs on tuberculosis incidence and prevalence. While IMF programs were connected with large reductions in generalized government expenditures, tuberculosis program coverage, and the number of physicians per capita, non-IMF Lending programs were not significantly associated with these variables.\n\nCONCLUSIONS: IMF economic reform programs are associated with significantly worsened tuberculosis incidence, prevalence, and mortality rates in post-communist Eastern European and former Soviet countries, independent of other political, socioeconomic, demographic, and health changes in these countries. Future research should attempt to examine how IMF programs may have related to other non-tuberculosis-related health outcomes.
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International Monetary Fund Programs and Tuberculosis Outcomes in Post-Communist
2008Co-Authors: Countries Stuckler, Lawrence King, Sanjay BasuAbstract:Background Previous studies have indicated that International Monetary Fund (IMF) economic programs have influenced health-care infrastructure in recipient countries. The post-communist Eastern European and former Soviet Union countries experienced relatively similar political and economic changes over the past two decades, and participated in IMF programs of varying size and duration. We empirically examine how IMF programs related to changes in tuberculosis incidence, prevalence, and mortality rates among these countries. Methods and Findings We performed multivariate regression of two decades of tuberculosis incidence, prevalence, and mortality data against variables potentially influencing tuberculosis program outcomes in 21 post-communist countries for which comparative data are available. After correcting for confounding variables, as well as potential detection, selection, and ecological biases, we observed that participating in an IMF program was associated with increased tuberculosis incidence, prevalence, and mortality rates by 13.9%, 13.2%, and 16.6%, respectively. Each additional year of participation in an IMF program was associated with increased tuberculosis mortality rates by 4.1%, and each 1% increase in IMF Lending was associated with increased tuberculosis mortality rates by 0.9%. On the other hand, we estimated a decrease in tuberculosis mortality rates of 30.7% (95% confidence interval, 18.3% to 49.5%) associated with exiting the IMF programs. IMF Lending did not appear to be a response to worsened health outcomes; rather, it appeared to be a precipitant of such outcomes (Granger- and Simscausality tests), even after controlling for potential political, socioeconomic, demographic, and health-related confounders. In contrast, non-IMF Lending programs were connected with decreased tuberculosis mortality rates (� 7.6%, 95% confidence interval, � 1.0% to � 14.1%). The associations observed between tuberculosis mortality and IMF programs were similar to those observed when evaluating the impact of IMF programs on tuberculosis incidence and prevalence. While IMF programs were connected with large reductions in generalized government expenditures, tuberculosis program coverage, and the number of physicians per capita, non-IMF Lending programs were not significantly associated with these variables. Conclusions IMF economic reform programs are associated with significantly worsened tuberculosis incidence, prevalence, and mortality rates in post-communist Eastern European and former Soviet countries, independent of other political, socioeconomic, demographic, and health changes in these countries. Future research should attempt to examine how IMF programs may have related to other non-tuberculosis–related health outcomes.
Alberto Zazzaro - One of the best experts on this subject based on the ideXlab platform.
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IMF Lending and Banking Crises
IMF Economic Review, 2015Co-Authors: Luca Papi, Andrea F Presbitero, Alberto ZazzaroAbstract:This paper looks at the effects of International Monetary Fund (IMF) Lending programs on banking crises in a large sample of developing countries, over the period 1970–2010. The endogeneity of the IMF intervention is addressed by adopting an instrumental variable strategy and a propensity score matching estimator. Controlling for the standard determinants of banking crises, the results indicate that countries participating in IMF-supported Lending programs are significantly less likely to experience a future banking crisis than nonborrowing countries. The paper also provides evidence suggesting that compliance with conditionality and loan size matter, corroborating the importance of IMF-supported reform and liquidity provision for banking sector stability.
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IMF Lending and Banking Crises
IMF Working Papers, 2015Co-Authors: Luca Papi, Andrea F Presbitero, Alberto ZazzaroAbstract:This paper looks at the effects of International Monetary Fund (IMF) Lending programs on banking crises in a large sample of developing countries, over the period 1970-2010. The endogeneity of the IMF intervention is addressed by adopting an instrumental variable strategy and a propensity score matching estimator. Controlling for the standard determinants of banking crises, our results indicate that countries participating in IMF-supported Lending programs are significantly less likely to experience a future banking crisis than nonborrowing countries. We also provide evidence suggesting that compliance with conditionality and loan size matter.
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IMF Lending and banking crises
2013Co-Authors: Luca Papi, Andrea F Presbitero, Alberto ZazzaroAbstract:In this paper we look at the effect of International Monetary Fund (IMF) Lending programs on banking crises in a large sample of developing countries, over the period 1965-2010. The endogeneity of the Fund intervention is addressed by adopting an instrumental variable (IV) strategy, in which the degree of political similarity between IMF borrowers and the G-7 is taken as an instrument for the likelihood of a country signing an IMF Lending arrangement. Controlling for the standard determinants of banking crises, the IV estimates suggest that previous IMF borrowers are significantly less likely to experience a banking crisis. We also provide evidence suggesting that compliance with conditionality matters, consistent with the importance of IMF-supported financial reform, and that the positive effect of the Fund intervention on banking sector stability works through a direct liquidity provision effect.
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IMF Lending in Times of Crisis: Political Influences and Crisis Prevention
World Development, 2012Co-Authors: Andrea F Presbitero, Alberto ZazzaroAbstract:In the wake of the global crisis the International Monetary Fund (IMF) has increased its exposure to developing countries and modified its Lending approach to enhance its crisis prevention role. In this paper we examine whether, during the current crisis, IMF Lending was actually directed at preventing the spread of the crisis and whether participation in IMF programs was sensitive to the politico-economic interests of the Fund’s main shareholders. We find that the political similarity with G7 countries is positively correlated with the probability of entering a loan agreement, while the harsher the crisis and the exposure of foreign banks in the country, the larger the loan granted by the IMF.
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IMF Lending in Low- and Middle-Income Countries in the Wake of the Global Crisis
SSRN Electronic Journal, 2010Co-Authors: Andrea F Presbitero, Alberto ZazzaroAbstract:In the wake of the global crisis the International Monetary Fund (IMF) increased its exposure to low- and middle-income countries and boosted the overhaul of its Lending approach to enhance its role in preventing crises. This paper tests whether IMF Lending has targeted countries most affected by the crisis in order to dampen contagion effects and assesses to what extent the Fund\'s strategy has been driven by political-economy interests of its major shareholders. Results show that political similarity between borrowers and G7 governments has influenced the participation in IMF pro-grams, especially where the crisis was severe. In addition, the extent of the crisis and the economic interest of Western countries have affected the size of the loan.
Strom C. Thacker - One of the best experts on this subject based on the ideXlab platform.
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The High Politics of IMF Lending
World Politics, 1999Co-Authors: Strom C. ThackerAbstract:Analysts have long suspected that politics affects the Lending patterns of the International Monetary Fund (IMF), but none have adequately specified or systematically tested competing explanations. This paper develops a political explanation of IMF Lending and tests it statistically on the developing countries between 1985 and 1994. It finds that political realignment toward the United States, the largest power in the IMF, increases a country's probability of receiving an IMF loan. A country's static political alignment position has no significant impact during this period, suggesting that these processes are best modeled dynamically. An analysis of two subsamples rejects the hypothesis that the IMF has become less politicized since the end of the cold war and suggests that the influence of politics has actually increased since 1990. The behavior of multilateral organizations is still driven by the political interests of their more powerful member states.
David Stuckler - One of the best experts on this subject based on the ideXlab platform.
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International monetary fund programs and tuberculosis outcomes in post-communist countries
PLoS Medicine, 2008Co-Authors: David Stuckler, Lawrence P. King, Sanjay BasuAbstract:BACKGROUND: Previous studies have indicated that International Monetary Fund (IMF) economic programs have influenced health-care infrastructure in recipient countries. The post-communist Eastern European and former Soviet Union countries experienced relatively similar political and economic changes over the past two decades, and participated in IMF programs of varying size and duration. We empirically examine how IMF programs related to changes in tuberculosis incidence, prevalence, and mortality rates among these countries.\n\nMETHODS AND FINDINGS: We performed multivariate regression of two decades of tuberculosis incidence, prevalence, and mortality data against variables potentially influencing tuberculosis program outcomes in 21 post-communist countries for which comparative data are available. After correcting for confounding variables, as well as potential detection, selection, and ecological biases, we observed that participating in an IMF program was associated with increased tuberculosis incidence, prevalence, and mortality rates by 13.9%, 13.2%, and 16.6%, respectively. Each additional year of participation in an IMF program was associated with increased tuberculosis mortality rates by 4.1%, and each 1% increase in IMF Lending was associated with increased tuberculosis mortality rates by 0.9%. On the other hand, we estimated a decrease in tuberculosis mortality rates of 30.7% (95% confidence interval, 18.3% to 49.5%) associated with exiting the IMF programs. IMF Lending did not appear to be a response to worsened health outcomes; rather, it appeared to be a precipitant of such outcomes (Granger- and Sims-causality tests), even after controlling for potential political, socioeconomic, demographic, and health-related confounders. In contrast, non-IMF Lending programs were connected with decreased tuberculosis mortality rates (-7.6%, 95% confidence interval, -1.0% to -14.1%). The associations observed between tuberculosis mortality and IMF programs were similar to those observed when evaluating the impact of IMF programs on tuberculosis incidence and prevalence. While IMF programs were connected with large reductions in generalized government expenditures, tuberculosis program coverage, and the number of physicians per capita, non-IMF Lending programs were not significantly associated with these variables.\n\nCONCLUSIONS: IMF economic reform programs are associated with significantly worsened tuberculosis incidence, prevalence, and mortality rates in post-communist Eastern European and former Soviet countries, independent of other political, socioeconomic, demographic, and health changes in these countries. Future research should attempt to examine how IMF programs may have related to other non-tuberculosis-related health outcomes.