Does the IMF Influence Fiscal and Monetary Policy?

Dreher, Axel

doi:10.1080/13841280500181726

Cited by 27 publications

(18 citation statements)

References 28 publications

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“…Economic growth is not significantly influenced by the implementation of conditions. Dreher (2005Dreher ( , 2006 achieves similar results for the 1970-2000 period. The two studies distinguish four major channels for the impact of the IMF on economic policies and outcomes: Money disbursed, money available, implemented conditions, and policy advice.…”

supporting

confidence: 69%

“…Regarding fiscal and monetary policy, there is evidence that participation in IMF Standby-and Extended Fund Facility arrangements improves economic policy (Dreher 2005). However, money disbursed and compliance with conditionality do not have any systematic influence.…”

mentioning

confidence: 99%

“…Dreher (2006) summarizes studies evaluating the IMF's impact on economic growth. More recent evaluations are, among others, Barro and Lee (2005), Hajro andJoyce (2009), Jensen (2004), Dreher (2005Dreher ( , 2006, Nsouli et al (2005) and Veiga (2006). 41 See Goldstein and Montiel (1986) for an extensive treatment.…”

mentioning

confidence: 99%

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IMF conditionality: theory and evidence

2009

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This article analyzes whether and to what extent reliance on conditionality is appropriate to guarantee the revolving character of the resources of the International Monetary Fund (IMF). The paper presents theoretical arguments in favor of conditionality, and those against the use of conditions. It summarizes the track record of program implementation and discusses the evidence of factors determining implementation. Whether proponents or critics of conditionality can be supported by existing data analysis is also investigated, as is the success of conditionality in terms of outcomes. The final section draws policy implications.

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supporting

confidence: 69%

mentioning

confidence: 99%

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IMF conditionality: theory and evidence

2009

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“…The finding of a negative (Barro and Lee, 2005;Dreher, 2006) or at best insignificant (Atoyan and Conway, 2006) causal effect of IMF programs on economic growth is troublesome in this respect since most theoretical models of sovereign debt point to a higher incidence of crises in times of economic hardship. The evidence is somewhat more encouraging for other factors potentially influencing sovereign risk like budget deficits and money growth (Dreher, 2005).…”

mentioning

confidence: 99%

The effect of IMF lending on the probability of sovereign debt crises

Jorra¹

2012

Journal of International Money and Finance

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. This paper explores empirically how the adoption of IMF programs affects sovereign risk over the medium term. We find that IMF programs significantly increase the probability of subsequent sovereign defaults by approximately 1.5 to 2 percentage points. These results cannot be attributed to endogeneity bias as they are supported by specifications that explain sovereign defaults and program participation simultaneously. Furthermore, IMF programs turn out to be especially detrimental to fiscal solvency when the Fund distributes its resources to countries whose economic fundamentals are already weak. Our evidence is therefore consistent with the hypothesis that debtor moral hazard is most likely to occur in these circumstances. Other explanations that point to the effects of debt dilution and the possibility of IMF triggered debt runs, however, are also possible. Terms of use: Documents inJournal of Economic Literature Classification Codes: F33, F34, C25, C35

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“…Dreher (2006) summarizes studies evaluating the IMF's impact on economic growth. More recent evaluations are, among others, Barro and Lee (2002), Hajro and Joyce (2004), Jensen (2004), Dreher (2005Dreher ( , 2006, Nsouli, Atoian and Mourmouras (2004) and Veiga (2005). 44 See Goldstein and Montiel (1986) for an extensive treatment.…”

Section: Success Of Imf Conditionalitymentioning

confidence: 99%