the international monetary fund and developing countries a review of the evidence and policy options as its systemic role evaporated with the collapse of the bretton woods system so the international monetary fund imf became drawn into a much more specific role in the context of the balance of payments bop problems that developing countries were encountering at its inception the imf had been seen as having no specific role in developing countries but now it became exclusively these countries that formed its clientele while during the 1970s the imf had continued to make a few relatively large loans to a limited number of industrial countries italy and the united kingdom beyond the mid 1970s industrial countries ceased to draw any resources from it

conformism peer pressure and adverse selection to examine the effects of peer pressure in adverse selection problem we define a peer pressure function that represents the psychological costs and incorporate it into the agent s utility function based on these assumptions the efficient agent who has conformity preference produces less outputs than the first best level while the inefficient agent produces more than the second best level of standard adverse selection output when the agents feel peer pressure among themselves although the production gap between the utility functions under peer pressure narrows the gap of the ex post information rent goes wider as the information rent of efficient agents increases our theoretical results are consistent with some empirical experimental findings

productivity growth catching up and uncertainty in china s meat trade abstract the potential role of china as a major importer of agricultural products and the likely impact on world markets has been a topic of considerable debate over the past decade in this paper we focus specifically on the livestock sector and develop a detailed analysis of productivity growth in china s pig and poultry production along with projections of china s likely meat trade in the year 2010 we use a general equilibrium model which permits us to explore the sensitivity of our projections to macro economic uncertainty as well as uncertainty in livestock productivity growth rates our analysis shows that china s net trade position is very sensitive to both of these factors with high livestock productivity growth and a slow down in the rest of the economy china could be a substantial competitor in export markets by 2010 on the other hand slow productivity growth in livestock production coupled with a rapidly growing macro economy could transform china into a major market for future meat exports

the demand for imf credits by sub saharan african countries abstract in this paper the demand behaviour of sub saharan african countries for imf credits will be studied on the basis of pooled cross section and time series analysis it will be concluded that drawings on imf facilities are not a purely economic phenomenon

some theoretical and empirical issues relating to economic stabilization in developing countries abstract this paper surveys some issues relating to economic stabilization in developing countries section 2 examines the contributions of terms of trade deterioration and real exchange rate appreciation to payments imbalances in non oil developing countries during the 1970s section 3 distinguishes between demand side and supply side policies and discusses their respective roles in stabilization programmes the effects of exchange rate changes are considered within this framework in section 4 the effects of alternative stabilization policies on output prices and the balance of payments are illustrated using simulations of a model that incorporates the major relationships relevant to a typical programme section 5 summarizes the conclusions

world bank directives domestic interests and the politics of human capital investment in latin america recent studies underscore the importance of international organizations in transmitting norms ideas and values to developing countries but has this diffusion influenced government policy in less developed countries during the past two decades the world bank has emphasized the need for third world governments to increase the stock of human capital by investing in education and health specifically it has encouraged developing countries to shift an increasing share of their resources toward primary education the authors examine 13 latin american countries between 1980 and 1992 to establish the relationship between world bank project lending and government investment in human capital they combine time series cross sectional analysis with field research to evaluate the world bank s influence on government spending on education and health although the world bank may be successful in convincing developing country technocrats to invest in people this research suggests that it is less successful in co

political economy influences within the life cycle of imf programmes increasing attention is being paid to political economy dimensions of the imf s operations however up until now the literature has lacked a systematic overview of how politics and economics interact in this context this paper sets out to fill the gap its conceptual basis is that of the life cycle of an imf programme what determines the decision to turn to the fund for financial assistance what determines the outcome of negotiations what determines whether a country will come back to the fund answers to these questions cannot be satisfactorily given by examining economics alone the paper draws on existing evidence to provide an empirically based discussion of the issues involved it also points the direction in which future research needs to go some of the policy implications of the analysis are also examined

exchange rate policies for developing countries the i98os saw major changes in exchange rate regimes in many developing countries the significance of which can now be assessed in addition there have been since i978 some fascinating experiments in the use of exchange rate policy for inflation stabilisation these experiences raise important issues this paper draws on a world bank supported project which examined in depth the macroeconomic experience of eighteen developing countries since i965 and especially during the period i 980 go table i lists the countries and gives some relevant information about them all examples come from these countries and generalisations are based on their experiences the focus here is on the contrast or competition between the real targets approach to exchange rate policy and the nominal anchor approach 2 the real targets approach might be described as orthodox but the nominal anchor approach has been frequently advocated especially by europeans the issues are somewhat similar to those debated in europe in connection with membership of the exchange rate mechanism of the ems and the proposed moves towards monetary union but as noted in section vi below in developing countries the balance of considerations is probably different and experiences certainly are first i shall deal with the choice of exchange rate regime for countries starting with low or moderate inflation the role of exchange rate policy in the stabilisation programmes of high inflation countries will be discussed in section v

parametric approaches to productivity measurement a comparison among alternative models this paper deals with modeling total factor productivity tfp growth in a flexible manner using panel data several competing parametric models are used to explore whether there are any similarities in the estimates of tfp growth and technical change among these models using a primal approach we decompose tfp growth into different components the models are then used to measure productivity and technical change in the swedish cement industry in general the results are found to be model dependent and often conflicting although much less so for returns to scale and overall productivity growth

an analysis of drawings on the international monetary fund by developing countries the nature of relations between the imf and developing countries has come under close scrutiny in recent years this has partly been the result of the deteriorating economic situation in which a large number of non oil developing countries have found themselves a situation characterised by falling rates of economic growth increasing balance of payments deficits and rising debt service ratios and partly it has resulted from the particular but public experiences of a number of developing countries such as jamaica peru and tanzania in their dealings with the fund

the reductionist gamble open economy politics in the global economy international political economy ipe should transition to third wave scholarship because open economy politics oep which dominates current american ipe scholarship can generate inaccurate knowledge oep can produce inaccurate knowledge because it studies domestic politics in isolation from international or macro processes this methodological reductionism is often inappropriate for the phenomena ipe studies because governments inhabit a complex social system as a result the political choices that oep strives to explain are typically a product of the interplay between domestic politics and macro processes when oep omits causally significant macro processes from empirical models the models yield biased inferences about the domestic political relationships under investigation although scholars tolerated such errors when the gains from oep were large these errors are less tolerable now that oep has matured consequently the field should transition toward research that is nonreductionist problem driven and pluralistic

china s food economy to the twenty first century supply demand and trade this paper accounts for the structural changes now taking place in china and suggests that china is not likely to become either an enormous importer or exporter of grain ultimately though china s grain balances will depend on decisions made by chinese policymakers rather than natural resource constraints p v this abstract was borrowed from another version of this item

imf conditionality coercion or compromise abstract the author compares the utility of three competing models of decision making in the international monetary fund with the purpose of determining how best one can understand how the imf decides on its conditionality vis a vis borrowing nations the three models focus on the following as alternative sets of factors in imf decision making 1 bureaucratic expertise and authority 2 dominance of political interests of major industrialized nations and 3 bargaining and compromise among imf staff and between the fund and borrowing countries based on interviews with imf officials and seven brief case studies the author concludes that bargaining and compromise is the most central dynamic of imf policy making

macroeconomic performance and adjustment under policies commonly supported by the international monetary fund the fundamental objective of any adjustment program whether supported by the international monetary fund imf or otherwise is to eliminate disequilibrium between aggregate demand and supply which is typically reflected in balance of payments deficits and rising prices in the past the imf stabilization programs were basically demand side the focus on the demand management is based on the absorption and especially the monetary approach to the balance of payments in recent years however the imf has recognized the importance of supply factors and thus adjustment programs include policy tools that deal with production bottlenecks ways to improve resource utilization and so forth this shift in policy does not however imply that the imf attaches less significance to demand than supply factors in his recent paper mohsen khan states that although supply shocks can cause disequilibrium between aggregate demand and supply often such imbalances can be traced to inappropriate policies that expand aggregate demand too rapidly relative to the growth of the productive capacity in the economy the purpose of this article is to examine directly the effects that a typical stabilization program may have on three important macroeconomic variables the growth rate in real output economic growth the inflation rate and the current account balance to provide some empirical foundation for the analysis the effects of such programs are illustrated through regression analysis three models that examine the relationship between relevant macroeconomic variables and the imf s instrumental tools are introduced the analysis covers 43 countries of which 27 are program countries that used imf financial resources during 1977 the period under study is 1977 83 during 1976 77 the

the effects of imf and world bank lending on long run economic growth an empirical analysis summary the international monetary fund and the world bank frequently and often repeatedly extend loans to developing nations these loans have been blamed for generating adverse economic outcomes the growth impact of fund and bank loan programs is assessed using an empirical growth model that controls for other determinants of growth a unique feature of this study is the use of the value of loans rather than the number of programs the estimates indicate that bank lending stimulates growth in some cases primarily by increasing public investment fund lending is either neutral or detrimental to growth the channel for this effect is a negative impact of fund lending on public as well as private investment

the economic and political determinants of imf and world bank lending in the middle east and north africa mena assumes both political and economic significance politically it is arguably the epicentre of world crisis chronically war prone and the site of the world s most protracted conflicts hinnebusch 2003 p 1 economically it owns the bulk of the world s oil reserves driving in particular the usa economic engine in light of the region s geopolitically and economically strategic position in the world economy it is clear that economic and political factors are inextricably linked when it comes to the manner in which the west particularly the usa responds to the region s needs

restructuring the imf s lending facilities the imf has recently completed a review of its lending facilities as a consequence of which it has implemented a number of reforms by examining the fund s basic functions this paper offers a critical appraisal of these reforms it is argued that more radical change is needed building on the liquidity and adjustment roles of the imf the reforms advocated here would reverse the proliferation of imf lending facilities that is to be observed since the early 1960s

is agricultural productivity in developing countries really shrinking new evidence using a modified nonparametric approach abstract nonparametric productivity analyses performed to date show that most developing countries are experiencing relatively rapid technical regress in agriculture we discuss the plausibility of these results and argue that they stem from the existence of biased technical change and the definition of technology used we reestimate the malmquist index for a group of developing countries using a different definition of technology and find that most developing countries in our sample are experiencing positive productivity growth with technical change being the main source of this growth

the effects of imf programs in the third world debate and evidence from latin america abstract this article reviews the debate about the effects of imf sponsored stabilization programs in the third world after examining recent studies by fund economists results of a new study on a latin american country set are presented in this research imf programs are associated with insignificant changes in the current account significant improvements in the overall balance of payments increases in inflation mixed effects on growth and a strong and consistent pattern of reduction in labor share of income the latter result is incorporated into a distribution oriented critique of fund policy

food consumption in urban china an empirical analysis this paper examines consumption patterns of urban households in china using aggregated household consumption data a demand system comprising six commodities rice pork vegetables fish eggs and fruits is estimated using a two stage budgeting procedure which incorporates an almost ideal deamnd system aids in each stage elasticity estimates from the system are plausible and consistent with other relevant studies results from this study strengthen the evidence of the emergence of a large chinese market for non stable food the study provides rationale and basis for additional research into chinese food consumption especially processed food

upping the ante for political economy analysis of the international financial institutions public choice analysis has clearly demonstrated the need to consider the roles of rent seeking and bureaucratic self interest in influencing the international economic policies of national governments and the behaviour of international organisations we have reached a stage however where more attention needs to be paid to the nature of bureaucratic incentives and the degree of discretion that bureaucracies have under different circumstances it is suggested that the incentives for budget maximisation are likely to vary substantially from one institution to another specifically such incentives seem likely to be much stronger for the world bank than fot the imf the evidence presented by rolanf vaubel for budget maximisation by the imf is critically examined and it is argued that much of this evidence is equally constant with other hypotheses thus there is a need for more research on the political economy of the international financial institutions

the high politics of imf lending analysts have long suspected that politics affects the lending patterns of the international monetary fund imf but none have adequately specified or systematically tested competing explanations this paper develops a political explanation of imf lending and tests it statistically on the developing countries between 1985 and 1994 it finds that political realignment toward the united states the largest power in the imf increases a country s probability of receiving an imf loan a country s static political alignment position has no significant impact during this period suggesting that these processes are best modeled dynamically an analysis of two subsamples rejects the hypothesis that the imf has become less politicized since the end of the cold war and suggests that the influence of politics has actually increased since 1990 the behavior of multilateral organizations is still driven by the political interests of their more powerful member states

imf lending programs participation and impact abstract participation in imf programs has been an option that more and more developing countries have exercised in recent years in this paper a detailed analysis of such participation over the period 1976 1986 provides a number of insights into the motivations for and the macroeconomic effects of such participation participation is driven by a combination of past performance present external influences and sluggish adjustment of developing countries the ability to predict which countries will participate in the imf program is quite good with nearly 90 percent of variation in such choices accounted for by the explanatory variables employed increased participation has as contemporaneous effects a reduction in economic growth and domestic investment and an improvement in the current account lagged effects of increased participation on economic growth and domestic investment are positive and in most estimates quantitatively greater than the contemporaneous effects there is also evidence of significantly lower public investment an increased budget surplus and real depreciation of the exchange rate with increased participation results for domestic credit creation and government current expenditure although they have a sign consistent with more austere policy cannot be shown to be significantly different from those not participating

the catalytic effect of lending by the international financial institutions for many less developed countries ldcs and countries in transition cits external financing is frequently an effective constraint on economic growth and development capital inflows may be used to overcome shortages of domestic saving thereby permitting higher levels of investment as well as shortages of foreign exchange thereby permitting larger quantities of imports

congressional politics of financing the international monetary fund we address the question of how international public goods are financed by analyzing voting in the u s congress on legislation to increase the u s contri bution to the international monetary fund imf we argue that legislators are more likely to vote in favor of an increase 1 the more campaign contributions they obtain from banks that specialize in international lending and 2 the greater the share of high skilled proglobalization workers in their districts the first argu ment supports the inference that a financially strong imf mitigates the risks of international lending to the benefit of the lending banks the second reflects our claim that voters view the imf as a positive force for global economic integration that following stolper samuelson reasoning benefits high skilled workers lastly we analyze imf loan decisions and find modest support for the claim that imf policy reflects the interests of major international banks overall our results sug gest that private actors within the united states have individual stakes in funding the imf the primary mandate of the international monetary fund imf or fund is to safeguard the stability of the global financial system an international public good the imf obtains the resources it needs for its stabilization operations from mem ber governments with large members contributing most of the funds in this arti cle we analyze the politics of funding the imf from the perspective of its largest contributor the united states rather than treating the united states as a single entity with a unified national interest at the fund we consider the preferences of political actors within the united states who exert power over financing the

meat and milk self sufficiency in asia forecast trends and implications abstract recent structural changes in dietary patterns in asia resulting from economic development are placing increasing pressure on the existing production systems in the region particularly those systems producing ruminant meat non ruminant meat and milk this has significant policy implications for the countries in the region in terms of self sufficiency goals in these commodities and the associated inter and intra regional trade opportunities in the future forecasts of ruminant meat non ruminant meat and milk production and consumption for selected asian countries between the years 2000 and 2010 revealed the following china pakistan and viet nam are likely to be self sufficient with respect to ruminant meat malaysia is likely to continue to be a net importer of ruminant meat india and malaysia will be more than self sufficient with respect to non ruminant meat with the converse being true for pakistan and india laos and pakistan will be self sufficient with respect to milk production with the possibility of indonesia thailand and cambodia becoming self sufficient if the current trends continue structural changes in the early 1980s generally resulted in higher average annual growth rates of production particularly in non ruminant meat production thus forecasts of ruminant meat production and consumption by 2000 using the medium term average annual growth rates for production present a more favourable outcome in terms of self sufficiency for countries such as bangladesh the philippines and viet nam but a less favourable outcome for countries such as indonesia malaysia laos and india similar forecasts for non ruminant meat indicated an improvement in the long term non ruminant self sufficiency estimates for most cases particularly for bangladesh china and cambodia intensification and commercialisation of meat production systems have increased meat self sufficiency in a number of countries but often at the expense of grain self sufficiency given these trends the impact of trade liberalisation measures on livestock production in the region and inter and intra regional trade of livestock commodities and grain is likely to be significant

reconciling chinese meat production and consumption data with more than one fifth of the world s population and only 7 of the world s arable land china has the potential to become a major importer of land intensive products such as feed grains this development would be of particular interest to the united states and canada which together have more than 17 of the world s arable land but only 5 of the world s population 1 per capita private consumption in china has been increasing at an average annual rate of 6 8 over the past decade given the low average income level in china consumption of feedgrain intensive products such as meat dairy products and alcohol can be expected to increase with continued income growth these factors take on greater significance given the fact that china has applied to join the world trade organization and trade liberalization may soon occur use of grain intensive products should increase if china liberalizes its agricultural markets and china should eventually reverse the current trade situation and begin to import large quantities of feed grains and meats the combination of these observations has stimulated interest in china s agricultural data and the research and policy prescriptions based on these data are greatly affected by the data s quality to understand why this is important consider the following examples official chinese and u s data show that per capita pork consumption in china is about 5 kilograms per person greater than it is in the united states 2 if this is true then it might be argued that chinese pork consumption is reaching a saturation level alternatively one might argue that the enormous increase in per capita pork consumption in the past several years implies a large expenditure elasticity any attempt to use this expenditure elasticity for projection of future meat demand in conjunction with strong growth in projected per capita income would imply a large percentage increase in consumption from a base that is already very high because feed grain consumption is directly dependent on livestock

the economic characteristics of imf program countries abstract a logit analysis is utilized to identify the factors that characterized developing nations that entered imf stabilization programs in the early 1980s program countries recorded higher rates of domestic credit growth larger shares of government expenditure more severe current account deficits smaller reserve holdings and lower per capita incomes

livestock in china commodity specific total factor productivity decomposition using new panel data studies of total factor productivity tfp in livestock production are rare but when available provide useful information especially in the context of developing countries such as china where livestock is becoming more important in the domestic agricultural economy we estimate tfp for four major livestock products in china employing the stochastic frontier approach and decompose productivity growth into its technical efficiency te and technical progress components efforts are made to adjust and augment the available livestock statistics the results show that growth in tfp and its components varied between the 1980s and the 1990s as well as over production structures while there is evidence of considerable technical innovation in china s livestock sector te improvement has been relatively slow