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Resistance to Implementing IMF Stabilization Plans: Evidence from a Cross-Country Study

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  • Oliveira, Gesner

Abstract

The paper addresses three aspects of the country's resistance to meet the targets of IMF stabilization plans. First, a definition and an indicator of such phenomenon is provided. The fact that resistance is found to be important poses doubts about presumed impacts of IMF programs such as in Pastor (1987). Second, a logit model is fitted to a data set of 43 countries to search for the resistance factors. The magnitude of the external shocks as well as income concentration were found to be relevant. The results obtained for this last variable are partially in line with the empirical evidence of Berg and Sachs (1988) and the theoretical motivation of Alesina and Drazen (1989). Third, a few policy implications are derived regarding the difficulties national and supra-national authorities are likely to face in attempting to enforce IMF stabilization measures.

Suggested Citation

  • Oliveira, Gesner, 1991. "Resistance to Implementing IMF Stabilization Plans: Evidence from a Cross-Country Study," Brazilian Review of Econometrics, Sociedade Brasileira de Econometria - SBE, vol. 11(1), April.
    • Handle: RePEc:sbe:breart:v:11:y:1991:i:1:a:3008
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    1. Mr. Morris Goldstein, 1986. "The Global Effects of Fund-Supported Adjustment Programs," IMF Occasional Papers 1986/002, International Monetary Fund.
    2. Jonathan Eaton & Mark Gersovitz & Joseph E. Stiglitz, 1991. "The Pure Theory of Country Risk," NBER Chapters, in: International Volatility and Economic Growth: The First Ten Years of The International Seminar on Macroeconomics, pages 391-435, National Bureau of Economic Research, Inc.
    3. Haggard, Stephan, 1985. "The politics of adjustment: lessons from the IMF's Extended Fund Facility," International Organization, Cambridge University Press, vol. 39(3), pages 505-534, July.
    4. Alesina, Alberto & Drazen, Allan, 1991. "Why Are Stabilizations Delayed?," American Economic Review, American Economic Association, vol. 81(5), pages 1170-1188, December.
    5. Berg, Andrew & Sachs, Jeffrey, 1988. "The debt crisis structural explanations of country performance," Journal of Development Economics, Elsevier, vol. 29(3), pages 271-306, November.
    6. Jeffrey D. Sachs, 1989. "Social Conflict and Populist Policies in Latin America," NBER Working Papers 2897, National Bureau of Economic Research, Inc.
    7. Sebastian Edwards, 1989. "The International Monetary Fund and the Developing Countries: A Critical Evaluation," NBER Working Papers 2909, National Bureau of Economic Research, Inc.
    8. Ron Phillips, 1983. "The Role of the International Monetary Fund in the Post-Bretton Woods Era," Review of Radical Political Economics, Union for Radical Political Economics, vol. 15(2), pages 59-81, June.
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