Aid and the Political Economy of Policy Change

What did structural adjustment adjust?

“…9 This has variously been addressed by using Heckman-type selection techniques, before and after analysis, or control group methodology. For example, in an earlier research, the World Bank (1992, p. 2) found that after controlling for selection bias, adjustment lending meant bthe middle-income countries enjoyed growth four percentage points higher than would otherwise have occurred and the low-income group had growth two percentage points higher.Q This early study concludes badjustment lending is also associated with improved policies.Q However, the results from a wide range of independent researchers, World Bank and IMF studies have been all over the map, with positive, zero, or negative effects of adjustment lending on growth, and with similarly mixed evidence of AL on policies (see the survey by Killick et al, 1998). Two recent studies (Przeworski and Vreeland, 2000;Barro and Lee, 2002) find a significantly negative effect of IMF lending on growth.…”

“…9 A partial listing is Barro and Lee, 2002, Conway, 1994, Corbo et al, 1987, Corbo and Fischer, 1995, Devarajan et al, 2001, Dicks-Mireaux et al (2000, Goldstein and Montiel (1986), Haque and Khan (1998), Hutchison (2001), Kapur et al, 1997, Khan, 1990, Killick, 1995, Killick et al, 1998, Knight and Santaella, 1997, Pritchett and Summers, 1993, Przeworski and Vreeland, 2000, Schadler et al, 1995, Svensson, 2003, Van de Walle, 2001, World Bank (1992, 1994.…”

Comparative learning in partnerships: control, competition or collaboration?

“…The relationship between donors and recipients has hierarchical character, because donors use superior financial resources to induce recipients to undertake actions (Killick, 1998). The relationship is also based on imperfect and asymmetrical information, as recipients are always in a position to know more than donors about their real performance and intentions.…”

The catalyzing role of policy-based lending by the IMF and the World Bank: fact or fiction?

“…Thus private markets may be more prepared to lend to countries where they perceive the multilaterals as ®lling a large 6 The incompatibilities between the various functions that conditionality is seeking to achieve are explored in detail in Collier et al (1997). The question of implementation and its links with conditionality are explored in Killick (1998) and Bird (1998). 7 Reference can again be made to the works cited in footnote 5. ul Haque and Khan (1998) provide what is probably the most sanguine view of the eects of IMF programmes.…”