IMF conditionality, export structure and economic complexity:The ineffectiveness of structural adjustment programs

Firat Demir

Journal of Comparative Economics, 2022, vol. 50, issue 3, 750-767

Abstract: The conditionality requirements of the International Monetary Fund (IMF) have been a source of intense debate since the early 1980s. These conditions, which are attached to IMF lending programs, cover a variety of issues from fiscal and monetary reform to economic liberalization and institutional change. In this paper we empirically examined the effects of IMF programs and conditionality requirements on structural transformation through changes in the technology-and-skill intensity and overall economic complexity of exports. Our empirical methodology accounted for policy and conditionality heterogeneity across country and time and accounts for the endogeneity of IMF programs and conditions. The empirical results suggest that IMF programs and conditionality requirements along a spectrum of policy areas had no robust or significant effect on export structure, economic complexity or export diversification. Overall, we found no evidence of any positive effects of IMF programs or IMF conditionality requirements on the technology-and-skill intensity of exports.

Keywords: IMF programs; IMF conditionality; Structural change; Export sophistication; Economic complexity (search for similar items in EconPapers)
JEL-codes: F33 F43 O14 O19 O33 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jcecon:v:50:y:2022:i:3:p:750-767

DOI: 10.1016/j.jce.2022.04.003

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