IDEAS home Printed from https://ideas.repec.org/p/sur/surrec/0107.html
   My bibliography  Save this paper

The Analysis of Catalysis: IMF Programs and Private Capital Flows

Author

Listed:
  • Graham Bird

    (University of Surrey)

  • Dane Rowlands

    (Norman Paterson School of International Affairs, Carleton University)

Abstract

This paper examines the claim that the IMF catalyzes other capital flows. We identify a series of propositions based on recent theoretical work, use a treatment effects model to deal with selection bias, and examine whether the IMF catalyzes both aggregate private financial flows and important subgroups for middle-income countries. The results presented here support many of the propositions, but also indicate that the sign and significance of catalysis varies according to the type of flow and the circumstances of the country. The finding that catalysis is complex and nuanced has important implications for policy that are briefly discussed.

Suggested Citation

  • Graham Bird & Dane Rowlands, 2007. "The Analysis of Catalysis: IMF Programs and Private Capital Flows," School of Economics Discussion Papers 0107, School of Economics, University of Surrey.
  • Handle: RePEc:sur:surrec:0107
    as

    Download full text from publisher

    File URL: https://repec.som.surrey.ac.uk/2007/DP01-07.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Vreeland,James Raymond, 2003. "The IMF and Economic Development," Cambridge Books, Cambridge University Press, number 9780521816755, May.
    2. Carmen M. Reinhart & Kenneth S. Rogoff, 2004. "The Modern History of Exchange Rate Arrangements: A Reinterpretation," The Quarterly Journal of Economics, Oxford University Press, vol. 119(1), pages 1-48.
    3. Graham Bird & Dane Rowlands, 1997. "The Catalytic Effect of Lending by the International Financial Institutions," The World Economy, Wiley Blackwell, vol. 20(7), pages 967-991, November.
    4. Curzio Giannini & Carlo Cottarelli, 2002. "Bedfellows, Hostages, or Perfect Strangers? Global Capital Markets and the Catalytic Effect of IMF Crisis Lending," IMF Working Papers 02/193, International Monetary Fund.
    5. Jeffrey A. Frankel & Nouriel Roubini, 2001. "The Role of Industrial Country Policies in Emerging Market Crises," NBER Working Papers 8634, National Bureau of Economic Research, Inc.
    6. Barro, Robert J. & Lee, Jong-Wha, 2005. "IMF programs: Who is chosen and what are the effects?," Journal of Monetary Economics, Elsevier, vol. 52(7), pages 1245-1269, October.
    7. Corsetti, Giancarlo & Guimaraes, Bernardo & Roubini, Nouriel, 2006. "International lending of last resort and moral hazard: A model of IMF's catalytic finance," Journal of Monetary Economics, Elsevier, vol. 53(3), pages 441-471, April.
    8. Vreeland,James Raymond, 2003. "The IMF and Economic Development," Cambridge Books, Cambridge University Press, number 9780521016957, May.
    9. J. Zettelmeyer, 2000. "Can Official Crisis Lending be Counterproductive in the Short Run?," Economic Notes, Banca Monte dei Paschi di Siena SpA, vol. 29(1), pages 13-29, February.
    10. Rowlands, Dane, 2001. "The Response of Other Lenders to the IMF," Review of International Economics, Wiley Blackwell, vol. 9(3), pages 531-546, August.
    11. 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, vol. 4(3), pages 243-270.
    12. Michael D. Bordo & Ashoka Mody & Nienke Oomes, 2004. "Keeping Capital Flowing: The Role of the IMF," International Finance, Wiley Blackwell, vol. 7(3), pages 421-450, December.
    13. Bird, Graham & Hussain, Mumtaz & Joyce, Joseph P., 2004. "Many happy returns? Recidivism and the IMF," Journal of International Money and Finance, Elsevier, vol. 23(2), pages 231-251, March.
    14. Diego Saravia & Ashoka Mody, 2003. "Catalyzing Capital Flows; Do IMF-Supported Programs Work As Commitment Devices?," IMF Working Papers 03/100, International Monetary Fund.
    15. Adrian Penalver, 2004. "How can the IMF catalyse private capital flows? A model," Bank of England working papers 215, Bank of England.
    16. Graham Bird & Dane Rowlands, 2002. "Do IMF Programmes Have a Catalytic Effect on Other International Capital Flows?," Oxford Development Studies, Taylor & Francis Journals, vol. 30(3), pages 229-249.
    17. repec:hrv:faseco:34721963 is not listed on IDEAS
    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


    Cited by:

    1. Graham Bird & Dane Rowlands, 2007. "Should it be curtains for some of the IMF’s lending windows?," The Review of International Organizations, Springer, vol. 2(3), pages 281-299, September.
    2. Ali J Al-Sadiq, 2015. "The Impact of IMF-Supported Programs on FDI in Low-income Countries," IMF Working Papers 15/157, International Monetary Fund.

    More about this item

    Keywords

    IMF; catalysis; international capital flows; private capital flows;

    JEL classification:

    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
    • F34 - International Economics - - International Finance - - - International Lending and Debt Problems
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sur:surrec:0107. 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: (Ioannis Lazopoulos). General contact details of provider: http://edirc.repec.org/data/desuruk.html .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.