Chapter 14 Long-Term Fiscal Developments and IMF Conditionality: Is There a Link?
Author:
Aleš Bulíř
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and
Soojin Moon
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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; program country; adjustment program; IMF arrangement; IMF program performance variable; program participation; Current account balance; Real interest rates; Nominal effective exchange rate

Abstract

The paper investigates fiscal developments in 112 countries during the 1990s. It finds that although the overall fiscal balance improved in most of them, the composition of this improvement differed. In countries without IMF-supported programs, revenues increased modestly and expenditure declined sharply, while in program countries both postprogram revenue and expenditure declined. In countries with programs that included fiscal structural conditions, however, the adjustment was effected primarily through sharp expenditure compression. No evidence of a statistically significant impact of IMF conditionality was found. Moreover, fiscal developments were influenced by cyclical factors and by the general stance of macroeconomic policies.

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ISBN:
9781589063617
Publication Date:
03 Apr 2006
Publisher:
International Monetary Fund
DOI:
https://doi.org/10.5089/9781589063617.072
Pages:
292

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