 Effects of Exchange Rate Regime on IMF Program ParticipationRobert Trudel Review of Policy Research, 2005, vol. 22, issue 6, 919-936 Abstract: This article investigates the effect of a domestic policy choice, the exchange rate regime, on countries’ interaction with an international institution, their participation in International Monetary Fund (IMF) lending agreements. I hypothesize that the effect of the level of international reserves on a country's probability of participation in an IMF program depends on the exchange rate regime. A low level of international reserves threatens unfavorable economic and political outcomes only in countries that maintain a fixed exchange rate regime. The level of reserves may thus be a significant determinant of participation in IMF programs only for countries that maintain a fixed exchange rate regime. I use a dynamic univariate probit model of IMF program participation to assess empirically the effect of reserves in countries that maintain fixed, intermediate, and floating exchange rate regimes. The empirical results support my hypothesis: reserves have a significant effect only in countries that maintain a fixed exchange rate. Date: 2005 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bla:revpol:v:22:y:2005:i:6:p:919-936 Ordering information: This journal article can be ordered from Access Statistics for this article Review of Policy Research is currently edited by Christopher Gore More articles in Review of Policy Research from Policy Studies Organization Contact information at EDIRC. |
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