The Fabric of Reform examines the effects of economic reform in three African countries in the CFA franc zone (see box on p. 3)— Cameroon, Côte d’Ivoire, and Mali—all of which gained their independence from France in 1960. Interviews with entrepreneurs, government officials, economists, and citizens help give the viewer insight into the economic gains brought about by reform as well as the challenges these countries continue to face.
1. Foreign investment is important to a country’s development. Ask students to research and report on an industry that was bolstered by foreign investment and the effect that this had on the country’s overall economic development in the decades immediately following the investment.
This guide is designed to facilitate classroom use of The Fabric of Reform, a 30-minute educational video created by the International Monetary Fund. It is intended for use with students in economics and international relations courses at the secondary and postsecondary levels.
To build better lives for their people, policymakers in developing countries must implement reforms that ensure that economic growth keeps pace with increasing populations. These reforms often must be implemented simultaneously or in a carefully planned sequence, and thus they necessitate a very high level of cooperative decision-making.
Mr. Rabah Arezki, Ms. Catherine A Pattillo, Mr. Marc G Quintyn, and Min Zhu
In the years following the global financial crisis, many low-income countries experienced rapid recovery and strong economic growth. However, many are now facing enormous difficulties because of rapidly rising food and fuel prices, with the threat of millions of people being pushed into poverty around the globe. The risk of continued food price volatility is a systemic challenge, and a failure in one country has been shown to have a profound impact on entire regions. This volume addresses the challenges of commodity price volatility for low-income countries and explores some macroeconomic policy options for responding to commodity price shocks. The book then looks at inclusive growth policies to address inequality in commodity-exporting countries, particularly natural resource rich countries. Perspectives from the Middle East and North Africa, sub-Saharan Africa, emerging Asia, and Mexico are presented and, finally, the role of the international donor community is examined. This volume is a must read for policymakers everywhere, from those in advanced, donor countries to those in countries with the poorest and most vulnerable populations.
This Study Guide is designed to facilitate classroom use of The Fabric of Reform, a 30-minute educational video created by the International Monetary Fund (IMF). The Guide is intended for use with students in economics and international relations courses at the secondary and post-secondary levels. It includes a segment-by-segment summary of the video; background information; pre-viewing, post-viewing, and research activities; a list of resources; a glossary; maps; and charts.
This paper provides empirical evidence that the propensity for political instability in the Central African Republic (C.A.R.) has been increased by low tax revenues and deteriorations in the terms of trade. The direct effect of political instability on economic growth is not statistically significant, once account is taken of domestic investment, and economic growth in neighboring countries. The policy implications are: (i) mobilization of domestic revenues to pay public employees' salaries and provide basic social services would lower the probability of coups; (ii) economic diversification would reduce the propensity for adverse terms of trade shocks to fuel coups; and (iii) neighboring countries' efforts to resolve conflicts and achieve sustained growth would be beneficial for the C.A.R.'s economic performance.
This paper argues that natural resource abundance creates opportunities for rent-seeking behavior and is an important factor in determining a country’s level of corruption. In a simple growth model, we illustrate the interrelationships between natural resources, corruption, and economic growth, and discuss potential anti-corruption policies. We show that the extent of corruption depends on natural resource abundance, government policies, and the concentration of bureaucratic power. Furthermore, the growth effects of natural resource discoveries and anticorruption policies crucially depend on the economy’s state of development. We empirically corroborate the model’s implications in a cross-country framework with both corruption and growth endogenized.