Chapter 10 What Determines the Implementation of IMF-Supported Programs?
Author:
Anna Ivanova https://isni.org/isni/0000000404811396 International Monetary Fund

Search for other papers by Anna Ivanova in
Current site
Google Scholar Close
Language:
English
Print Publication Date:
03 Apr 2006
Keywords:
SEM; IMF program; country; IMF-supported program; program implementation; IMF effort; current account ratio; Current account; Capital flows; Private capital flows; Fiscal stance; Global; Sub-Saharan Africa; East Asia; Africa; Europe

Abstract

The paper provides a quantitative analysis of the factors that determine successful implementation of IMF-supported programs. To this end, we construct new measures of program implementation and compliance with conditionality for 170 IMF programs approved between 1992 and 1998. The main hypothesis tested is whether IMF effort and the design of conditionality significantly affect the probability of successful implementation of IMF-supported programs. We find that program implementation depends primarily on the borrower’s domestic political economy. Strong special interests in the parliament, political instability, inefficient bureaucracies, lack of political cohesion, and ethno-linguistic divisions weaken program implementation. IMF effort, the design of conditionality, and initial and external conditions do not materially influence program prospects.

Other IMF Content

Other Publishers Content

  • Collapse
  • Expand
Cover IMF-Supported Programs
IMF-Supported Programs
Recent Staff Research
ISBN:
9781589063617
Publication Date:
03 Apr 2006
Publisher:
International Monetary Fund
DOI:
https://doi.org/10.5089/9781589063617.072
Pages:
292

  • Åslund, Anders, 1999, “Why Has Russia’s Economic Transformation Been So Arduous?” paper prepared for the Annual World Bank Conference on Development Economics (Washington: Carnegie Endowment for International Peace), April 28–30.

    • Search Google Scholar
    • Export Citation

  • Beck, Thorsten, George Clarke, Alberto Groff, Philip Keefer, and Patrick Walsh, 2001, “New Tools in Comparative Political Economy: The Database of Political Institutions,” World Bank Economic Review, Vol. 15 (September), pp. 165 –76.

    • Search Google Scholar
    • Export Citation

  • Bird, Graham, 2002, “Conditionality and Ownership: How to Improve the Implementation of IMF Programmes,” Working Paper (Guildford, Surrey, United Kingdom: Surrey Center for International Economic Studies, University of Surrey).

    • Search Google Scholar
    • Export Citation

  • Birdsall, Nancy, 2000, “The World Bank of the Future: Victim, Villain, Global Credit Union?” remarks delivered at the conference “Promoting Dialogue: Global Challenges and Global Institutions” (Washington: American University), April 13, available on the Web at http://www.odc.org/commentary/bird-au.html.

    • Search Google Scholar
    • Export Citation

  • Boughton, James M., and Alex Mourmouras, 2002, “Whose Programme Is It? Policy Ownership With Conditional Lending,” Chapter 9 in The IMF and its Critics, ed. by David Vines and Christopher L. Gilbert (Cambridge, United Kingdom: Cambridge University Press), pp. 225 –53.

    • Search Google Scholar
    • Export Citation

  • Bredenkamp, Hugh, and Susan Schadler, eds., 1999, Economic Adjustment and Reform in Low-Income Countries (Washington: International Monetary Fund).

    • Search Google Scholar
    • Export Citation

  • Bulíř, Aleš, and Soojin Moon, 2003, “Do IMF-Supported Programs Help Make Fiscal Adjustment More Durable?” IMF Working Paper 03/38 (Washington: International Monetary Fund). This paper also appears, in somewhat different form, as Chapter 14 in this volume.

    • Search Google Scholar
    • Export Citation

  • Conway, Patrick, 1994, “IMF Lending Programs: Participation and Impact,” Journal of Development Economics, Vol. 45, pp. 365 –91.

  • Conway, Patrick, 1998a, “Evaluating Fund Programs: Methodology and Empirical Estimates” (unpublished working paper: University of North Carolina at Chapel Hill).

    • Search Google Scholar
    • Export Citation

  • Conway, Patrick, 1998b, “IMF Programs and External Balance: The Crisis-Participation Dynamic” (unpublished working paper: University of North Carolina at Chapel Hill).

    • Search Google Scholar
    • Export Citation

  • Dollar, David, and Jakob Svensson, 2000, “What Explains the Success or Failure of Bank-Supported Adjustment Programs,” Economic Journal, Vol. 110 (October), pp. 894 –917.

    • Search Google Scholar
    • Export Citation

  • Drazen, Allan, 2002, “Conditionality and Ownership in IMF Lending: A Political Economy Approach,” Staff Papers, International Monetary Fund, Vol. 49, Special Issue, pp. 36 –67.

    • Search Google Scholar
    • Export Citation

  • Easterly, William, and Ross Levine, 1997, “Africa’s Growth Tragedy: Policies and Ethnic Divisions,” Quarterly Journal of Economics, Vol. 112, pp. 203 –50.

    • Search Google Scholar
    • Export Citation

  • Haque, Nadeem Ul, and Mohsin S. Khan, 1998, “Do IMF-Supported Programs Work? A Survey of the Cross-Country Empirical Evidence,” IMF Working Paper 98/169 (Washington: International Monetary Fund).

    • Search Google Scholar
    • Export Citation

  • Havrylyshyn, Oleh, and John Odling-Smee, 2000, “Political Economy of Stalled Reforms,” Finance & Development, Vol. 37 (September), pp. 7 –10.

    • Search Google Scholar
    • Export Citation

  • Hellman, Joel, and Daniel Kaufmann, 2001, “Confronting the Challenge of State Capture in Transition Economies,” Finance & Development, Vol. 38 (September), pp. 31 –35.

    • Search Google Scholar
    • Export Citation

  • International Monetary Fund (IMF), 1998, External Evaluation of the ESAF: Report by a Group of Independent Experts (Washington: International Monetary Fund).

    • Search Google Scholar
    • Export Citation

  • International Monetary Fund (IMF), 2001a, “Strengthening Country Ownership of Fund-Supported Programs” (Washington: International Monetary Fund), available on the Web at http://www.imf.org/external/np/pdr/cond/2001/eng/strength/120501.pdf.

    • Search Google Scholar
    • Export Citation

  • International Monetary Fund (IMF), 2001b, “Conditionality in IMF-Supported Programs—Policy Issues” (Washington: International Monetary Fund), March, available on the Web at http://www.imf.org/external/np/pdr/cond/2001/eng/policy/021601.pdf.

    • Search Google Scholar
    • Export Citation

  • International Monetary Fund (IMF), 2001c, “Structural Conditionality in IMF-Supported Programs” (Washington: International Monetary Fund), March, available on the Web at http://www.imf.org/external/np/pdr/cond/2001/eng/struct/cond.pdf.

    • Search Google Scholar
    • Export Citation

  • International Monetary Fund (IMF), 2002, “Guidelines on Conditionality” (Washington: International Monetary Fund), September, available on the Web at http://www.imf.org/External/np/pdr/cond/2002/eng/guid/092302.htm.

    • Search Google Scholar
    • Export Citation

  • Joreskog, Karl G., and Arthur Goldberger, 1975, “Estimation of a Model with Multiple Indicators and Multiple Causes of a Single Latent Variable,” Journal of the American Statistical Association, Vol. 70 (September), pp. 631 –39.

    • Search Google Scholar
    • Export Citation

  • Joyce, Joseph P., 2002, “Through a Glass Darkly: What We Know (and Don’t Know) About IMF Programs,” paper presented at the IMF Conference on Research on IMF-Supported Programs, Washington, June.

    • Search Google Scholar
    • Export Citation

  • Killick, Tony, with Ramani Gunatilaka and Ana Marr, 1998, Aid and the Political Economy of Policy Change (London: Routledge).

  • Lubotsky, Darren, and Martin Wittenberg, 2001, “Interpretation of Regressions with Multiple Proxies,” (unpublished working paper; Princeton, New Jersey: Princeton University).

    • Search Google Scholar
    • Export Citation

  • Mayer, Wolfgang, and Alex Mourmouras, 2002, “Vested Interests in a Positive Theory of IFI Conditionality,” IMF Working Paper 02/73 (Washington: International Monetary Fund).

    • Search Google Scholar
    • Export Citation

  • Mecagni, Mauro, 1999, “The Causes of Program Interruptions,” in Economic Adjustment and Reform in Low-Income Countries, ed. by Hugh Bredenkamp and Susan Schadler (Washington: International Monetary Fund).

    • Search Google Scholar
    • Export Citation

  • Mussa, Michael, and Miguel Savastano, 1999, “The IMF Approach to Economic Stabilization,” IMF Working Paper 99/104 (Washington: International Monetary Fund).

    • Search Google Scholar
    • Export Citation

  • Odling-Smee, John, 2001, “Belarus: Recent Experience and Challenges Ahead,” speech given at the Belarusian Academy of Management, Minsk, November 6, available on the Web at http://www.imf.org/external/np/speeches/2001/110601.htm.

    • Search Google Scholar
    • Export Citation

  • Schadler, Susan, Adam Bennett, Maria Carkovic, Louis Dicks-Mireaux, Mauro Mecagni, James H. J. Morsink, and Miguel A. Savastano, 1995a, IMF Conditionality: Experience Under Stand-By and Extended Arrangements, Part I: Key Issues and Findings, IMF Occasional Paper No. 128 (Washington: International Monetary Fund).

    • Search Google Scholar
    • Export Citation

  • Schadler, Susan, Adam Bennett, Maria Carkovic, Louis Dicks-Mireaux, Mauro Mecagni, James H. J. Morsink, and Miguel A. Savastano, 1995b, IMF Conditionality: Experience Under Stand-By and Extended Arrangements, Part II: Background Papers, IMF Occasional Paper No. 129 (Washington: International Monetary Fund).

    • Search Google Scholar
    • Export Citation

  • Thomas, Alun, 2003, “Prior Actions—True Repentance? An Evaluation Based on IMF Programs over the 1992–1999 Period” (unpublished paper; Washington: Policy Development and Review Department, International Monetary Fund).

    • Search Google Scholar
    • Export Citation

  • Tsebelis, George, 2001, Veto Players: How Political Institutions Work (Princeton, New Jersey: Princeton University Press and Russell Sage Foundation).

    • Search Google Scholar
    • Export Citation