Advanced Search
MyIDEAS: Login to save this article or follow this journal

Revisiting the Effects of IMF Programs on Poverty and Inequality

Contents:

Author Info

  • Oberdabernig, Doris A.

Abstract

Investigating how lending programs of the International Monetary Fund (IMF) affect poverty and inequality, we explicitly address model uncertainty. We control for endogenous selection into IMF programs using data on 86 low- and middle income countries for the 1982–2009 period and analyze program effects on various poverty and inequality measures. The results rely on averaging over 90 specifications of treatment effect models and indicate adverse short-run effects of IMF agreements on poverty and inequality for the whole sample, while for a 2000–09 subsample the results are reversed. There is evidence that significant short-run effects might disappear in the long-run.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.sciencedirect.com/science/article/pii/S0305750X13000399
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by Elsevier in its journal World Development.

Volume (Year): 46 (2013)
Issue (Month): C ()
Pages: 113-142

as in new window
Handle: RePEc:eee:wdevel:v:46:y:2013:i:c:p:113-142

Contact details of provider:
Web page: http://www.elsevier.com/locate/worlddev

Related research

Keywords: poverty and income distribution; IMF lending programs; model uncertainty; treatment effects; cross-country analysis; developing countries;

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Bourguignon, Francois & Branson, William H. & de Melo, Jaime, 1992. "Adjustment and income distribution : A micro-macro model for counterfactual analysis," Journal of Development Economics, Elsevier, vol. 38(1), pages 17-39, January.
  2. Robert J Barro & Jong-Wha Lee, 2003. "IMF Programs: Who Is Chosen and What Are the Effects?," Departmental Working Papers, The Australian National University, Arndt-Corden Department of Economics 2003-09, The Australian National University, Arndt-Corden Department of Economics.
  3. Handa, Sudhanshu & King, Damien, 1997. "Structural adjustment policies, income distribution and poverty: A review of the jamaican experience," World Development, Elsevier, Elsevier, vol. 25(6), pages 915-930, June.
  4. Morduch, Jonathan, 1994. "Poverty and Vulnerability," American Economic Review, American Economic Association, American Economic Association, vol. 84(2), pages 221-25, May.
  5. Przeworski, Adam & Vreeland, James Raymond, 2000. "The effect of IMF programs on economic growth," Journal of Development Economics, Elsevier, vol. 62(2), pages 385-421, August.
  6. Christoph Moser & Jan-Egbert Sturm, 2011. "Explaining IMF lending decisions after the Cold War," The Review of International Organizations, Springer, Springer, vol. 6(3), pages 307-340, September.
  7. Ricardo Martin & Alex Segura-Ubiergo, 2005. "Social Spending in IMF-supported Programs," Public Economics, EconWPA 0504011, EconWPA.
  8. Graham Bird & Dane Rowlands, 2001. "IMF lending: how is it affected by economic, political and institutional factors?," Journal of Economic Policy Reform, Taylor & Francis Journals, Taylor & Francis Journals, vol. 4(3), pages 243-270.
  9. Robert J. Barro & Jong-Wha Lee, 2010. "A New Data Set of Educational Attainment in the World, 1950–2010," NBER Working Papers 15902, National Bureau of Economic Research, Inc.
  10. Collier, Paul & Gunning, Jan Willem, 1999. "The IMF's Role in Structural Adjustment," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 109(459), pages F634-51, November.
  11. Gernot Doppelhofer & Ronald I. Miller & Xavier Sala-i-Martin, 2000. "Determinants of Long-Term Growth: A Bayesian Averaging of Classical Estimates (Bace) Approach," OECD Economics Department Working Papers 266, OECD Publishing.
  12. Wood, Adrian & Ridao-Cano, Cristobal, 1999. "Skill, Trade, and International Inequality," Oxford Economic Papers, Oxford University Press, vol. 51(1), pages 89-119, January.
  13. Paul Mosley & John Hudson & Arjan Verschoor, 2004. "Aid, Poverty Reduction and the 'New Conditionality'," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 114(496), pages F217-F243, 06.
  14. Axel Dreher & Stefanie Walter, 2008. "Does the IMF Help or Hurt? The Effect of IMF programs on the likelihood and outcome of currency crises," KOF Working papers 08-186, KOF Swiss Economic Institute, ETH Zurich.
  15. Sala-i-Martin, Xavier, 1997. "I Just Ran Two Million Regressions," American Economic Review, American Economic Association, American Economic Association, vol. 87(2), pages 178-83, May.
  16. Helge Berger & Jakob de Haan & Jan-Egbert Sturm, 2005. "Which Variables Explain Decisions on IMF Credit? An Extreme Bounds Analysis ," TWI Research Paper Series 13, Thurgauer Wirtschaftsinstitut, Universität Konstanz.
  17. Loayza, Norman V. & Raddatz, Claudio, 2006. "The composition of growth matters for poverty alleviation," Policy Research Working Paper Series 4077, The World Bank.
  18. Collier, Paul & Dollar, David, 2002. "Aid allocation and poverty reduction," European Economic Review, Elsevier, vol. 46(8), pages 1475-1500, September.
  19. Mattias Lundberg & Lyn Squire, 2003. "The simultaneous evolution of growth and inequality," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 113(487), pages 326-344, 04.
  20. World Bank, 2010. "World Development Indicators 2010," World Bank Publications, The World Bank, number 4373, October.
  21. Nissanke, Machiko & Thorbecke, Erik, 2006. "Channels and policy debate in the globalization-inequality-poverty nexus," World Development, Elsevier, Elsevier, vol. 34(8), pages 1338-1360, August.
  22. Axel Dreher & Jan-Egbert Sturm, 2012. "Do the IMF and the World Bank influence voting in the UN General Assembly?," Public Choice, Springer, Springer, vol. 151(1), pages 363-397, April.
  23. Oecd, 2002. "Aid volume, channels and allocations for poverty reduction," OECD Journal on Development, OECD Publishing, vol. 3(3), pages 33-46.
  24. Ravallion, Martin & Chen, Shaohua, 1997. "What Can New Survey Data Tell Us about Recent Changes in Distribution and Poverty?," World Bank Economic Review, World Bank Group, World Bank Group, vol. 11(2), pages 357-82, May.
  25. Heckman, James J, 1978. "Dummy Endogenous Variables in a Simultaneous Equation System," Econometrica, Econometric Society, Econometric Society, vol. 46(4), pages 931-59, July.
  26. Paul Cashin & Catherine A. Pattillo & Ratna Sahay & Paolo Mauro, 2001. "Macroeconomic Policies and Poverty Reduction," IMF Working Papers 01/135, International Monetary Fund.
  27. Easterly, William & Fischer, Stanley, 2001. "Inflation and the Poor," Journal of Money, Credit and Banking, Blackwell Publishing, Blackwell Publishing, vol. 33(2), pages 160-78, May.
  28. David Dollar & Aart Kraay, 2004. "Trade, Growth, and Poverty," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 114(493), pages F22-F49, 02.
  29. Adams, Richard Jr., 2004. "Economic Growth, Inequality and Poverty: Estimating the Growth Elasticity of Poverty," World Development, Elsevier, Elsevier, vol. 32(12), pages 1989-2014, December.
  30. repec:imf:imfocp:58 is not listed on IDEAS
  31. Edward E. Leamer, 1982. "Let's Take the Con Out of Econometrics," UCLA Economics Working Papers, UCLA Department of Economics 239, UCLA Department of Economics.
  32. Michael D. Bordo & Anna J. Schwartz, 2000. "Measuring Real Economic Effects of Bailouts: Historical Perspectives on How Countries in Financial Distress Have Fared With and Without Bailouts," NBER Working Papers 7701, National Bureau of Economic Research, Inc.
  33. Garuda, Gopal, 2000. "The Distributional Effects of IMF Programs: A Cross-Country Analysis," World Development, Elsevier, Elsevier, vol. 28(6), pages 1031-1051, June.
  34. Conway, Patrick, 1994. "IMF lending programs: Participation and impact," Journal of Development Economics, Elsevier, vol. 45(2), pages 365-391, December.
  35. Leamer, Edward E, 1985. "Sensitivity Analyses Would Help," American Economic Review, American Economic Association, American Economic Association, vol. 75(3), pages 308-13, June.
  36. Deininger, Klaus & Squire, Lyn, 1998. "New ways of looking at old issues: inequality and growth," Journal of Development Economics, Elsevier, vol. 57(2), pages 259-287.
  37. J Harrigan & C Wang & H El-Said, 2004. "The Economic and Politics Determinants of IMF and World Bank Lending in the Middle East and North Africa," The School of Economics Discussion Paper Series, Economics, The University of Manchester 0411, Economics, The University of Manchester.
  38. Carmen Fernandez & Eduardo Ley & Mark Steel, 1999. "Model uncertainty in cross-country growth regressions," Econometrics, EconWPA 9903003, EconWPA, revised 06 Oct 2001.
  39. Bernhard G. Gunter & Marc J. Cohen & Hans Lofgren, 2005. "Analysing Macro-Poverty Linkages: An Overview," Development Policy Review, Overseas Development Institute, vol. 23(3), pages 243-265, 05.
  40. Barry Eichengreen & Poonam Gupta & Ashoka Mody, 2008. "Sudden Stops and IMF-Supported Programs," NBER Chapters, in: Financial Markets Volatility and Performance in Emerging Markets, pages 219-266 National Bureau of Economic Research, Inc.
  41. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
  42. repec:fth:oxesaf:99-18 is not listed on IDEAS
  43. Omotunde Johnson & Joanne Salop, 1980. "Distributional Aspects of Stabilization Programs in Developing Countries (Les programmes de stabilisation des pays en développement examinés sous l'aspect de la répartition du revenu) (Los pr," IMF Staff Papers, Palgrave Macmillan, vol. 27(1), pages 1-23, March.
  44. Sebastian Edwards & Márcio G. P. Garcia, 2008. "Financial Markets Volatility and Performance in Emerging Markets," NBER Books, National Bureau of Economic Research, Inc, number edwa05-1, October.
  45. Ruben Atoyan & Patrick Conway, 2006. "Evaluating the impact of IMF programs: A comparison of matching and instrumental-variable estimators," The Review of International Organizations, Springer, Springer, vol. 1(2), pages 99-124, June.
  46. International Monetary Fund, 1998. "Do IMF-Supported Programs Work? a Survey of the Cross-Country Empirical Evidence," IMF Working Papers 98/169, International Monetary Fund.
  47. Andersen, Thomas Barnebeck & Harr, Thomas & Tarp, Finn, 2006. "On US politics and IMF lending," European Economic Review, Elsevier, vol. 50(7), pages 1843-1862, October.
  48. Jacques J. Polak, 1991. "The Changing Nature of IMF Conditionality," OECD Development Centre Working Papers 41, OECD Publishing.
  49. Meschi, Elena & Vivarelli, Marco, 2009. "Trade and Income Inequality in Developing Countries," World Development, Elsevier, Elsevier, vol. 37(2), pages 287-302, February.
  50. Levine, Ross & Renelt, David, 1991. "A sensitivity analysis of cross-country growth regressions," Policy Research Working Paper Series 609, The World Bank.
  51. Selim Elekdag, 2006. "How Does the Global Economic Environment Influence the Demand for IMF Resources," IMF Working Papers 06/239, International Monetary Fund.
  52. Arpac, Ozlem & Bird, Graham & Mandilaras, Alex, 2008. "Stop Interrupting: An Empirical Analysis of the Implementation of IMF Programs," World Development, Elsevier, Elsevier, vol. 36(9), pages 1493-1513, September.
  53. Fassil Fanta & Mukti Upadhyay, 2009. "Poverty reduction, economic growth and inequality in Africa," Applied Economics Letters, Taylor & Francis Journals, Taylor & Francis Journals, vol. 16(18), pages 1791-1794.
  54. Frederick Solt, 2009. "Standardizing the World Income Inequality Database," Social Science Quarterly, Southwestern Social Science Association, vol. 90(2), pages 231-242.
  55. Easterly, William, 2001. "The effect of International Monetary Fund and World Bank programs on poverty," Policy Research Working Paper Series 2517, The World Bank.
  56. Polak, J.J., 1991. "The Changing Nature of IMF Conditionality," Princeton Studies in International Economics, International Economics Section, Departement of Economics Princeton University, 184, International Economics Section, Departement of Economics Princeton University,.
  57. Dicks-Mireaux, Louis & Mecagni, Mauro & Schadler, Susan, 2000. "Evaluating the effect of IMF lending to low-income countries," Journal of Development Economics, Elsevier, vol. 61(2), pages 495-526, April.
  58. Dollar, David & Kraay, Aart, 2002. " Growth Is Good for the Poor," Journal of Economic Growth, Springer, Springer, vol. 7(3), pages 195-225, September.
  59. Martin Steinwand & Randall Stone, 2008. "The International Monetary Fund: A review of the recent evidence," The Review of International Organizations, Springer, Springer, vol. 3(2), pages 123-149, June.
  60. Sen, Amartya, 1979. " Issues in the Measurement of Poverty," Scandinavian Journal of Economics, Wiley Blackwell, Wiley Blackwell, vol. 81(2), pages 285-307.
  61. Raymond Vreeland, James, 2002. "The Effect of IMF Programs on Labor," World Development, Elsevier, Elsevier, vol. 30(1), pages 121-139, January.
  62. Kenny, Charles & Williams, David, 2001. "What Do We Know About Economic Growth? Or, Why Don't We Know Very Much?," World Development, Elsevier, Elsevier, vol. 29(1), pages 1-22, January.
  63. Dreher, Axel & Sturm, Jan-Egbert & Vreeland, James Raymond, 2009. "Global horse trading: IMF loans for votes in the United Nations Security Council," European Economic Review, Elsevier, vol. 53(7), pages 742-757, October.
  64. Andrea Brandolini & Anthony B. Atkinson, 2001. "Promise and Pitfalls in the Use of "Secondary" Data-Sets: Income Inequality in OECD Countries As a Case Study," Journal of Economic Literature, American Economic Association, vol. 39(3), pages 771-799, September.
  65. Nelson, Forrest D., 1984. "Efficiency of the two-step estimator for models with endogenous sample selection," Journal of Econometrics, Elsevier, Elsevier, vol. 24(1-2), pages 181-196.
  66. Evrensel, Ayse Y., 2002. "Effectiveness of IMF-supported stabilization programs in developing countries," Journal of International Money and Finance, Elsevier, Elsevier, vol. 21(5), pages 565-587, October.
  67. Carlos Leite & Charalambos G. Tsangarides & Dhaneshwar Ghura, 2002. "Is Growth Enough? Macroeconomic Policy and Poverty Reduction," IMF Working Papers 02/118, International Monetary Fund.
  68. Zlata Hajro & Joseph Joyce, 2009. "A true test: do IMF programs hurt the poor?," Applied Economics, Taylor & Francis Journals, Taylor & Francis Journals, vol. 41(3), pages 295-306.
  69. Graham Bird & Ramkishen S. Rajan, 2001. "Banks, Financial Liberalisation and Financial Crises in Emerging Markets," The World Economy, Wiley Blackwell, vol. 24(7), pages 889-910, 07.
  70. Nooruddin, Irfan & Simmons, Joel W., 2006. "The Politics of Hard Choices: IMF Programs and Government Spending," International Organization, Cambridge University Press, Cambridge University Press, vol. 60(04), pages 1001-1033, October.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Christian Mumssen & Yasemin Bal-Gunduz & Christian Ebeke & Linda Kaltani, 2013. "IMF-Supported Programs in Low Income Countries: Economic Impact over the Short and Longer Term," IMF Working Papers 13/273, International Monetary Fund.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:eee:wdevel:v:46:y:2013:i:c:p:113-142. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.