IMF and Economic Growth: The Effects of Programs, Loans, and Compliance with Conditionality

Axel Dreher

International Finance from University Library of Munich, Germany

Abstract: In theory, the IMF could influence economic growth via several channels, among them advice to policy makers, money disbursed under its programs, and its conditionality. This paper tries to separate those effects empirically. Using panel data for 98 countries over the period 1970-2000 it analyzes whether IMF involvement influences economic growth in program countries. Consistent with the results of previous studies, it is shown that IMF programs reduce growth rates when their endogeneity is accounted for. There is also evidence that compliance with conditionality mitigates this negative effect, while the overall impact, however, remains negative. IMF loans have no robust statistically significant impact.

Keywords: IMF programs; growth; compliance; conditionality (search for similar items in EconPapers)
JEL-codes: F33 F34 O57 (search for similar items in EconPapers)
Date: 2004-04-07, Revised 2005-08-13
New Economics Papers: this item is included in nep-dev, nep-his and nep-pke
Note: Type of Document - pdf
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Citations: View citations in EconPapers (39)

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Related works:
Journal Article: IMF and economic growth: The effects of programs, loans, and compliance with conditionality (2006)
Working Paper: IMF and Economic Growth: The Effects of Programs, Loans, and Compliance with Conditionality (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpif:0404004

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