Structural Reforms, Uncertainty, and Private Investment

Tove Strauss
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Tove Strauss: Trade Union Institute for Economic Research, Postal: FIEF, Wallingatan 38, SE-111 24 Stockholm, Sweden

No 165, Working Paper Series from Trade Union Institute for Economic Research

Abstract: Since almost two decades back a large number of LDCs have embarked on World Bank supported structural adjustment programs with the objective to promote econ-omic growth and private investment. I consider how the design of reform programs can increase reform credibility and thus reduce uncertainty in the economy. Using new data on adjustment lending, I test the effects of reform on private investment behavior. I find that while most political factors seem to have no effect on private investment response in reforming countries, magnitude as well as scope of reforms are important explanatory variables.

Keywords: Credibility; Economic reform; Private investment; Structural adjustment; Uncertainty (search for similar items in EconPapers)
JEL-codes: C21 E61 E65 O11 O19 O23 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2000-12-22
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:hhs:fiefwp:0165

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