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Assessing the Macroeconomic Impact of Structural Reforms in Ukraine
Author:
Mr. Anil Ari
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https://orcid.org/0000-0002-8707-6985
and
Gabor Pula
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Series:
IMF Working Papers
Volume/Issue:
Volume 2021: Issue 100
Language:
English
Publication Date:
23 Apr 2021
DOI:
https://doi.org/10.5089/9781513582580.001
ISBN:
9781513582580
ISSN:
1018-5941
Pages:
37
Keywords:
growth impact; reform gap; reform scenario; scenario Ukraine; indicator value; Structural reforms; Total factor productivity; Commodity markets; International reserves; Corruption; Eastern Europe
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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Ukraine’s economic performance has been anemic since the early 1990s. A major impediment to productivity growth has been low investment, held back by lack of strong and independent institutions. This paper aims to assess the major areas of institutional weakness in Ukraine and quantify the long-term growth impact of catching-up to Poland in terms of the quality of major economic institutions and market development. Our analysis identifies the legal system as the area where the institutional quality is weakest compared to Poland, followed distantly by market competition, openness to trade and financial depth. Using a methodology that accounts for positive spillovers between the structural reform areas, we estimate that even under the most optimistic scenario, where institutional gaps are fully addressed, Ukraine would need 15 years to catch up to Poland’s current income level.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund