The political economy of participation in IMF programs: a disaggregated empirical analysis |
| |
Authors: | Graham Bird Jim Mylonas Dane Rowlands |
| |
Institution: | 1. The Robert Day School of Economics and Finance, Claremont McKenna College, Claremont, CA, USA;2. BCA Research, Toronto, ON, Canada;3. Norman Paterson School of International Affairs, Carleton University, Ottawa, ON, Canada |
| |
Abstract: | What factors determine whether or not countries have programs with the International Monetary Fund (IMF)? The existing literature suggests that a number of economic and political variables are important, but there is disagreement about their relative significance. Moreover, the fit of general participation models is not particularly good. An increasingly popular view in the recent literature is that the pattern of IMF lending is politically driven and that it reflects the interests of the Fund’s leading shareholders; the US is seen as exerting a powerful influence. Using both quantitative and qualitative techniques, and based on an informal analytical framework, we examine in detail the factors that may be at work. We cover the period from 1984 to 2008. We discover considerable variation across the nature of programs (concessional and non-concessional), income levels, geographic regions, and time periods. The degree of observed variation means that it is unsafe to use one general participation model as the basis for evaluating the effects of IMF programs. It also means that the design of policy needs to reflect the nuances that the data reveal. |
| |
Keywords: | international finance political economy international relations |
|
|