the effect of imf lending on the probability of sovereign debt crises abstract this paper explores empirically how the adoption of imf programs affects sovereign risk over the medium term we find that imf programs significantly increase the probability of subsequent sovereign defaults by approximately 1 5 2 percentage points these results cannot be attributed to endogeneity bias as they are supported by specifications that explain sovereign defaults and program participation simultaneously furthermore imf programs turn out to be especially detrimental to fiscal solvency when the fund distributes its resources to countries whose economic fundamentals are already weak our evidence is therefore consistent with the hypothesis that debtor moral hazard is most likely to occur in these circumstances other explanations that point to the effects of debt dilution and the possibility of imf triggered debt runs however are also possible

boon or burden the effect of private sector debt on the risk of sovereign default in developing countries i introduction the past two decades witnessed a strong increase in private foreign borrowing in emerging markets and developing countries although in 1990 the private sector accounted for a mere 16 of all external loans disbursed to developing countries this share has increased to 77 in 2006 figure 1a likewise in 2006 the private sector s non publicly guaranteed debt liabilities accounted for 44 of developing countries total external debt up from a mere 5 in 1990 figure 1b 1 a key question in light of the ongoing global financial turmoil is what the boom in private sector external indebtedness will imply for sovereign risk in developing countries in this paper we empirically investigate the record of the past three decades to throw some light on this issue on theoretical grounds there are arguments both in favor and against a stabilizing effect of private sector borrowing on sovereign risk a critical view of private sector exposure is based on the notion that large scale private borrowing creates vulnerabilities that may eventually lead to a sovereign default a sudden stop may force the public sector to assume at least part of the private debt and this may eventually cause debt service difficulties for the government following this logic both public and private external debt pose a threat to sovereign creditworthiness the opposite argument that private sector borrowing does not harm government creditworthiness can be made by invoking the idea that the private sector is exposed to greater competitive pressure which raises the incentives to use the borrowed funds productively more importantly a potentially stabilizing role of private sector borrowing can also be linked to the distributional consequences of sovereign defaults agents who are reliant on foreign credit are particularly vulnerable to the disruptions that come along with sovereign default a larger share of the private sector in total external debt a proxy of the relative size and stake of agents that would be hurt by sovereign default would thus raise the political costs of default given the competing theoretical arguments the role of the private sector for sovereign creditworthiness is an empirical question a first impression of how these magnitudes may be related is provided in figure 2 which plots the institutional investor s measure of country creditworthiness iiccr against the level of external debt relative to gni figure 2a and the share of private long term external debt in countries total long term external debt figure 2b 2 not surprisingly the correlation between debt and creditworthiness is negative 0 37 by contrast the correlation between private sector share and the iiccr is positive 0 54 3 although this picture obviously does not prove a causal relationship it suggests that relative private sector exposure and perceived creditworthiness might be positively related figure 1 omitted figure 2 omitted further evidence that private and public debt are likely to have very different effects on the risk of sovereign default is provided in table 1 the entries in this table are cross country averages of various debt related variables just before the onset of 5 yr periods in which a sovereign default did or did not take place 4 the first column of table 1 shows that initial debt relative to gni is on average much higher before a default period than before a non default period conversely column 2 indicates that the average share of the private sector in total external debt is much higher before non default periods than before default periods a first look at the data thus seems to point into the direction that a higher share of private debt in total external debt is associated with higher perceived creditworthiness as reflected by the institutional investor s country credit ratings and with a lower likelihood of sovereign default

catalytic finance when does it work in a model of debt crisis caused partly by creditor coordination failure we show that bailouts that reduce ex post inefficiency will sometimes enhance the incentives for governments to take costly adjustment effort this model helps us understand a debate about the role of the imf in catalyzing lending to developing countries

union growth in the netherlands 1961 1989 an empirical analysis is presented of union growth in the netherlands over the past decades the analysis shows that the effect of changes in the industrial structure is very small it appears that union growth is influenced by wage growth and by unemployment if real wages increase more than labour productivity or if unemployment declines union membership increases

adoption of an imf programme and debt rescheduling an empirical analysis the existence of an empirical relationship between the adoption of an imf programme and the concession of a debt rescheduling by commercial and official creditors is tested using a bivariate probit model if countries who have arrangements with the imf are more likely than others to obtain a rescheduling of their external debt we could conclude that the adoption of an imf programme could work as a sort of signal of a country s good willingness which is thus rewarded with the debt relief the results confirm the existence of a significant effect of the adoption of an imf programme on the subsequent concession of a debt rescheduling by creditors

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

does multilateral lending aid capital accumulation role of intellectual capital and institutional quality abstract this paper investigates whether multilateral lending is more effective in accumulating capital in countries with a higher level of innovation specifically we examine the role of the world bank or imf financing on the capital stock using data from 175 countries over the period 1970 2017 while considering different types of long term external flows namely fdi and debt we find that fdi as a long term inflow influences domestic capital stock positively but non g7 countries even with a higher level of innovation are unable to benefit from greater fdi flows in boosting their capital stock which we explain considering institutional quality differences across countries with regard to foreign debt flows the multilateral lending only benefits the borrowing country if it has a greater level of intellectual capital or if those funds are used in financing innovative activities as opposed to short term imf loans world bank lending tends to be directed more towards long term development goals thereby helping boost productive capital exploiting a policy intervention with trips agreement the paper uncovers that countries with better institutional quality and greater innovation generate a higher level of capital stock

a quantitative model of sovereign debt bailouts and conditionality in times of sovereign debt crises international financial institutions provide temporary financial support contingent on the implementation of specific macroeconomic policies this paper develops a model of sovereign debt and default with endogenous participation rates in bailout programs conditionality enters as a constraint on fiscal policy in the model the insurance character of bailouts generates incentives for debt accumulation quantitative results suggest that bailouts prevent sovereign defaults in the short run but may come at a cost of a greater default probability in the long run increasing the intensity of conditionality lowers the bailout participation rate and generates a hump shaped pattern of sovereign default risk

the imf a bird s eye view of its role and operations the international monetary fund imf is the world s premier international financial institution with 184 member countries and active programmes in a significant number of them at any one time the fund attracts a great deal of attention much of it critical but the discussion is often polemic in style strongly held but frequently opposing views are expressed this survey attempts to examine in an objective way the theory and evidence relating to the fund s operations many aspects of the empirical research are relatively recent and a universal consensus is yet to emerge as a consequence there is scope for disagreement to persist however the research is also gradually clarifying many important issues the format for the survey is to examine the life cycle of imf arrangements what makes a country turn to the fund for assistance should the imf be lending what influences the outcome of negotiations and the design of programmes are imf programmes effective and why do some countries make prolonged use of imf resources for completeness there is also some discussion of the history of the imf the extent to which fund policies have been influenced by advances in economic theory and the fund s systemic role important organisational and governance issues are also covered briefly although primarily adopting an economist s perspective the survey reflects the growing recognition that in order to understand the imf s operations economics has to be combined with politics examining the imf is an exercise in applied political economy copyright 2007 the author journal compilation 2007 blackwell publishing ltd

renegotiation collective action clauses and sovereign debt markets abstract collective action clauses cacs are provisions specifying that a supermajority of bondholders can change the terms of a bond we study how cacs determine governments fiscal incentives sovereign bond prices and default probabilities in environments with and without contingent debt and imf presence we claim that cacs are likely to be an irrelevant dimension of debt contracts in current sovereign debt markets because of the variety of instruments utilized by sovereigns and the implicit imf guarantee nonetheless under a new international bankruptcy regime like that recently proposed by the imf cacs can increase significantly the cost of borrowing for sovereigns contrary to what is suggested in previous empirical literature

three approaches to predict the timing and quantity of ldc debt rescheduling the performance of three approaches to predict the timing and quantity of ldc debt rescheduling is examined the balance sheet approach the traditional macro approach and the structural approach results show that the balance sheet approach performs better

dutch trade union membership 1979 1995 determinants of dutch trade union membership are analysed for the years 1979 1987 and 1995 by means of a decomposition method it is established that changing characteristics of the working population primarily caused the union decline between 1979 and 1987 whereas the recovery afterwards can be entirely attributed to changing unionization behaviour a further application of the decomposition method shows that the contribution of the separate explanatory variables to shifts in the density rate is less straightforward than the results of the first analyses suggest

international financial contagion in currency crises abstract this paper examines the role of financial linkages especially through a common creditor in the propagation of emerging market crises during the 1990s using panel probit regressions on 41 emerging market countries it finds that financial linkages played a significant role in the spread of the mexican asian and russian crises the significance of financial linkages emerges after controlling for the role of domestic and external fundamentals trade spillovers and financial weaknesses in the affected countries a strong financial linkage to the crisis country of origin not only substantially raises the probability of contagion but also helps to explain the observed regional concentration of currency crises

sovereign debt structural adjustment and conditionality abstract the lack of a proper enforcement mechanism for sovereign debt generates a commitment failure as a result a sovereign may seek to improve its position in debt renegotiations and thus evade its debt obligations by reducing exports conditionality seeks to provide a solution to the incentive problem by addressing the commitment failure formalizing this argument we show that conditionality helps the repayment of sovereign debt in certain circumstances it can eliminate debt overhang especially when it is coupled with concessionary lending of sufficient magnitude it is however unable to restore first best when it is anticipated by lenders conditionality may get international financial institutions and sovereign debtors into a trap where the debt overhang persist debt rescheduling takes place periodically and conditionality continues indefinitely

financial crises and political crises abstract the simultaneous determination of financial default and political crises is studied in an open economy model political crises accompany default in equilibrium because of an information transmission conflict between the government and the public multiple equilibria are possible if foreign lenders are pessimistic about the country s stability they demand a high interest on the debt exacerbating distortions and possibly leading to political crisis but if lenders are optimistic the cost of the debt falls and political crises disappear in such a case international liquidity packages can select the best equilibrium and rule out political crises at negligible cost

conformity replication of design and business niches conformity affects the choice and design of organizations conformists replicate successful strategies play along with the rules of the game and display inert behavior conformity leads to the dominance of one mode the combined impact of conformity and inertia and the existence of employment costs switching costs and network externalities may exclude equally or superior efficient modes from replacing the incumbent mode the first mover unable to overcome these barriers to entry efficient maverick organizations are forced into niches this is illustrated with respect to niches formed by labor managed firms and ethnic businesses

estimating the probability of trade union membership a study of men and women in britain the paper examines the determinants of the individual decision to unionize for british employees and uses micro data from the 1975 national training survey the unionization probability is estimated separately for manual and non manual men and full time and part time women an interesting finding is that personal characteristics of both men and women generally do not affect the unionization probability this result run counter to the common perception that family responsibilities explain low female trade union density

simple solutions to the initial conditions problem in dynamic nonlinear panel data models with unobserved heterogeneity i study a simple widely applicable approach to handling the initial conditions problem in dynamic nonlinear unobserved effects models rather than attempting to obtain the joint distribution of all outcomes of the endogenous variables i propose finding the distribution conditional on the initial value and the observed history of strictly exogenous explanatory variables the approach is flexible and results in simple estimation strategies for at least three leading dynamic nonlinear models probit tobit and poisson regression i treat the general problem of estimating average partial effects and show that simple estimators exist for important special cases copyright 2005 john wiley sons ltd

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

sovereign bond yield spreads and sustainability an empirical analysis of oecd countries abstract we study whether and how a country s environmental social and governance esg performance relates to its sovereign borrowing costs in international capital markets we hypothesize that good esg performance plays an economic role it signals a country s commitment to sustainability and long term orientation and is a buffer against negative shocks leading to lower sovereign bond yield spreads using a sample of 20 oecd countries over the period 1996 2012 we show that countries with good esg performance are associated with lower default risk and lower sovereign bond yield spreads moreover we show that the social and governance dimensions have a significant negative association with sovereign bond yield spreads whereas the environmental dimension does not

international financial crises causes prevention and cures dale jorgenson has bestowed a great honor and no small challenge by inviting me to give this lecture a great honor because of the distinguished list of economists who have preceded me a challenge because of the standard they have set and because there is no greater challenge for any economist than providing a coherent account of significant events to his scientific peers i am sometimes asked by friends about the differences between academic life and life as a public official there are many two stand out first as an academic the gravest sin one can commit is to sign one s name to something one did not write as a public official it is a mark of effectiveness to do so as often as possible second as an academic if a problem is too hard and does not admit of a satisfactory solution there is an obvious response work on a different problem that is not a luxury that one has in government i have been reminded of this often in recent years as we have grappled with financial crises in a number of what had previously been considered emerging markets with unrestrained futures anyone who doubts the social importance of what economists do should consider the debates surrounding these crises hundreds of millions of people who expected rapidly rising standards of living have seen their living standards fall hundreds of thousands if not millions of children have been forced to drop out of school and go to work hundreds of billions of dollars of apparent wealth has been lost the stability of large nations as nations has been called into question and the united states has made its largest nonmilitary foreign policyrelated financial commitments since the marshall plan almost all the issues involved in understanding preventing and mitigating these crises are the stuff of economics courses and research fixed versus flexible exchange rates moral hazard and multiple equilibria speculation and liquidity fiscal and monetary policies regulation and competition what economists think say and do has profound implications for the lives of literally billions of their fellow citizens whether it is discussing the role of derivatives in signaling exchange rate commitments with chinese premier zhu rongji or discussing an nber working paper on inflation targeting with the brazilian central bank governor arminio fraga or discussing alternative approaches to bankruptcy law with indonesia s economic team or optimal debt durations with the mexican authorities i am consistently struck by the impact of the kind of research discussed at the aea meetings the future well being of the world s people in large part will depend on how the ongoing process of global integration works out this is a strong statement but one that is supported by the global economy s post world war i failure and its post world war ii success central to global integration is financial integration the flow of funds and of capital across international borders and as the events of the late 1920 s and early 1930 s remind us central to global disintegration can be international financial breakdowns today i want to reflect on the issue of global financial integration in light of the dramatic and largely unpredicted events of recent years it is perhaps a good time for reflection there has been enough repair that priority can shift from u s department of the treasury 1500 pennsylvania avenue washington dc 20005 this lecture reflects many things i have learned from experiences i have shared with colleagues in the united states government and governments around the world i thank brad delong marty feldstein stephanie flanders ken rogoff andrei shleifer and ted truman for useful comments and suggestions i am especially grateful to nouriel roubini and stephanie flanders for valuable discussions and assistance in the preparation of this lecture the usual disclaimer applies

using country balance sheet data to predict debt rescheduling in this study we utilise data relating to the balance sheets of developing countries e g short term debt in a logit model of debt rescheduling we find that such variables are theoretically and empirically superior to those conventionally used such as debt export ratios the study is based upon an annual sample of 27 countries for 1977 1981 and a six monthly data set involving 59 countries from 1977 1985

predicting the quantity of ldc debt rescheduling in this paper we estimate a type 2 tobit model to explain both the timing and quantity of developing country debt rescheduling using an annual data set for 27 countries from 1977 1981 and six monthly data for 59 countries from 1977 1985 we obtain a satisfactory model for both the timing and quantity of rescheduling which will be more useful for country risk analysis than models which predict the timing alone

private sector share of external debt and financial stability evidence from bank loans abstract in the last two decades the private sector has contracted a substantially larger share in the total amount of foreign currency international debt private sector share of external debt especially in developing countries in this paper i empirically examine the effect of this phenomenon on bank loan prices i find that the private sector share of external debt negatively and significantly impacts the price of bank loans this result supports the hypothesis that private sector debt contributes to international financial stability to a greater degree than sovereign debt nevertheless this impact is canceled out in the presence of fixed exchange regimes that are unsuitable with respect to fundamentals in such circumstances the private sector may take advantage of capital market distortions that are maintained by official authorities and thus exposes the country to further financial instability additional results corroborate the observation that the gain in financial stability stems from more efficient use of funds and reduced monitoring costs

catalysing private capital flows do imf programmes work as commitment devices in this article we examine whether imf programmes influence the ability of developing country issuers to tap international bond markets and if they improve spreads paid on the bonds issued we find that fund programmes do not provide a uniformly favourable signalling effect instead the evidence is most consistent with a positive effect of imf programmes when they are viewed as likely to lead to policy reform and when undertaken before economic fundamentals have deteriorated significantly the size of the fund s programme matters but the credibility of a joint commitment by the country and the imf appears to be critical enhancing its members access to international capital markets is widely regarded as an important objective of the international monetary fund imf or fund though the objective is not an explicitly stated purpose in the fund s articles of agreements the flow of international capital is essential to such stated purposes as the stability of the international monetary system efficient trade and productive resource use and to providing confidence when a member country experiences difficulties with its balance of payments 1 the fund s interest in private international capital flows has moreover increased over the last decade reflecting this evolution the fund s former managing

sovereign default private sector creditors and the ifis abstract the data reveal that emerging market sovereign borrowing from international financial institutions ifis is small intermittent and countercyclical compared to that from private sector creditors the ifi loan contracts offered to sovereigns differ from the private ones in that they are more enforceable and have conditionality arrangements attached to them taking these contractual differences as given this paper builds a quantitative model of a sovereign borrower and argues that better enforceability of ifi loan contracts is the main institutional feature that explains the size and cyclicality while conditionality accounts for the intermittency of borrowing from the ifis

currency crashes in emerging markets an empirical treatment we use a panel of annual data for over 100 developing countries from 1971 through 1992 to characterize currency crashes we define a currency crash as a large change of the nominal exchange rate that is also a substantial increase in the rate of change of nominal depreciation we examine the composition of the debt as well as its level and a variety of other macroeconomic factors external and foreign crashes tend to occur when output growth is low the growth of domestic credit is high and the level of foreign interest rates are high a low ratio of fdi to debt is consistently associated with a high likelihood of a crash

imf conditionality as a screening device a theoretical model is developed in which adoption of an imf programme signals a country s productivity it is assumed that there are two types of country one with a high return on investment and the other with a low return the country s type is known only to itself in the presence of a debt overhang the high productivity country may choose not to undertake the investment despite it being socially efficient to do so in this case the creditor would like to offer the country some debt reduction but the low productivity type will also benefit from the debt reduction this problem can be avoided if the country has sufficient resources to engage in a debt buyback in order to gain the debt relief only the high productivity type would be prepared to sacrifice current resources for the debt reduction and thus a separation of the types is achieved this is similar to an argument found in acharya and diwan 1993 we argue however that it is unlikely that a heavily indebted country will have sufficient resources for a buyback if the country is credit constrained an alternative screening mechanism is to undertake an imf programme in return for debt reduction and possibly an imf loan this mechanism can be the equilibrium outcome even if the programme creates only disutility for the country s policy makers

does the imf perform a catalytic role the imf advertises itself as playing a catalytic role whereby its lending programmes induce other providers of finance to invest or lend as well the theoretical foundations of this claim are reviewed and found to be questionable the empirical evidence also appears to contradict the notion of a consistent and significant catalytic effect the policy implications of weak catalysis are reviewed and alternative approaches to delivering a suitable adjustment process investigated while some of these alternatives seem worthy of further evaluation including greater official coordination and the use of alternative private and official pools of capital many are politically or operationally untenable

rules of thumb for sovereign debt crises abstract this paper investigates the economic and political conditions that are associated to the occurrence of a sovereign debt crisis we use a new statistical approach classification and regression tree that allows us to derive a collection of rules of thumb that help identify the typical characteristics of defaulters we find that not all crises are equal they differ depending on whether the government faces insolvency illiquidity or various macroeconomic risks we also characterize the set of fundamentals that can be associated with a relatively risk free zone this classification is important for discussing appropriate policy options to prevent crises and improve response time and prediction

economic determinants of imf financial arrangements abstract we analyze factors that lead to imf approval of financial arrangements we account for both economic variables that induce a country to seek an imf arrangement demand side factors and macroeconomic policy commitments that the imf considers when deciding whether to approve it supply side factors using a pooled sample of annual observations for 91 developing countries over 1973 1991 we obtain maximum likelihood bivariate and univariate probit estimates of the approval of an imf arrangement for a given country in a given year a number of demand side and supply side variables are statistically significant determinants of the approval of an imf arrangement

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 debt crisis structural explanations of country performance abstract this paper develops a cross country statistical model of debt rescheduling and the secondary market valuation of ldc debt which links these variables to key structural characteristics of developing countries such as the trade regime the degree of income inequality and the share of agriculture in gnp our most striking finding is that higher income inequality is a significant predictor of a higher probability of debt rescheduling in a cross section of middle income countries we attribute this correlation to various difficulties of political management in economies with extreme inequality we also find that outward orientation of the trade regime is a significant predictor of a reduced probability of debt rescheduling

state dependence and stickiness of sovereign credit ratings evidence from a panel of countries using data from moody s we examine three sources of sovereign credit ratings persistence true state dependence spurious state dependence and serial error correlation accounting for ratings persistence we also examine whether ratings were sticky or procyclical for two major crises the european debt crisis and the east asian crisis we set up a dynamic panel ordered probit model with autocorrelated disturbances and nonparametrically distributed random effects an efficient markov chain monte carlo algorithm is designed for model estimation we find evidence of stickiness of ratings and of the three sources of ratings persistence with the true state dependence being weak

country balance sheet data vs traditional macro variables in a logit model to predict debt rescheduling abstract this paper presents empirical estimates of rescheduling probabilities for 68 debtor countries using semi annual data from 1981 i through 1988 ii the set of regressors integrates bis data on banks balance sheet positions e g the ratio of short term debt to total debt of developing countries or undisbursed credit commitments to total debt with traditional macro variables e g export growth or gross domestic product of the g7 all estimated equations have a high explanatory power the novel result is that as the prediction lag is lengthened the significance of the macro variables improves relative to the one of the balance sheet data this suggests that macro variables are proxies for more fundamental longer term determinants of a country s solvency whilst financial variables provide information about the country s current liquidity

the international monetary fund in a time of crisis a review of stanley fischer s imf essays from a time of crisis the international financial system stabilization and development stanley fischer was deputy managing director of the imf from 1994 to 2001 and perhaps more than any other individual he personifies the international rapid response to financial crises in the 1990s this book is a collection of essays written during his tenure at the imf taken together the essays represent the strongest and most logical defense of imf initiatives in the 1990s in print my review essay comprises six parts in parts 2 through 4 i provide an overview of fischer s arguments in three central areas of contention stabilization policy the impact of imf programs on poverty and the imf s anticipation of and response to international financial crisis i then compare fischer s arguments to those raised by the imf s critics during that period the controversial issues of these parts can be resolved only through empirical investigation but on the issues of greatest importance from the financial crises of the 1990s both fischer and the imf s critics make logically consistent arguments with little empirical support in part 5 i review the recent empirical literature to illuminate what evidence has been found in support of or counter to the assertions of fischer and the imf s critics part 6 provides conclusions and suggestions for follow on empirical research

the employment of married women in the united kingdom 1970 83 the proportion of married women in employment in the united kingdom grew rapidly during the 1970s rising from around 50 to 60 per cent the paper investigates this change using a time series of cross sections from the family expenditure survey an attempt is made to assess how much of the change was due to trends in the observable characteristics of the population and what part was played by changes in behavioural and other factors reflected in the coefficients of the model a technique of growth accounting is proposed and used to this purpose excerpt

global horse trading imf loans for votes in the united nations security council we investigate whether temporary members of the united nations security council receive favorable treatment from the international monetary fund imf using panel data for 197 countries over the period from 1951 to 2004 our results indicate a robust positive relationship between temporary security council membership and participation in imf programs even after accounting for economic political and country specific factors there is also evidence that security council membership reduces the number of conditions included in imf programs imf loans seem to be a mechanism by which the major shareholders of the fund can win favor with voting members of the security council

tenure issues in higher education the system of tenure that dominates american higher education has long been a source of controversy the institution of tenure has been attacked for entrenching a lazy professoriate more interested in attending faraway conferences and producing unreadable research than in teaching or developing practical insights while on the other hand it has long been defended as an absolute necessity for the defense of open intellectual inquiry the tenure controversy has been sharpened in recent years by several events the end of mandatory retirement which was abolished by federal law effective january 1 1994 has heightened concerns about the productivity and commitment of professors who received tenure long ago and who no longer have the same incentives to invest in long term reputation there is also ongoing concern over the steadily rising cost of higher education which raises the question of what students as well as the taxpayers who support public institutions of higher education are getting for their money 1 the idea that tenure is a wasteful institution for universities runs up against the puzzling fact that the commitment to tenure is one that academic institutions impose on themselves although the american association of university professors aaup provides a powerful lobby in favor of tenure generally colleges and universities most notably private ones are under no legal requirement to observe tenure constraints although as administrators we certainly feel the weight of those constraints our view is that a tenure system in fact provides important benefits to society and to colleges and universities we argue here that the role of tenure is

human resource management and performance in european firms we develop a theoretical framework to examine three hypotheses on the relationship between human resource management hrm practices and organisational performance in european firms the first is that collaborative forms of hrm practice are more strongly associated with superior firm performance than calculative forms the second is that these associations are strongest where national institutional and normative settings support them the third is that employer employee consultative committees and collective payment methods are also associated with superior firm performance the first two propositions are strongly empirically supported as is the third albeit more weakly the implications of the findings for european policy and varieties of capitalism theory are discussed

the macroeconomic effects of war finance in the united states world war ii and the korean war during world war ii government expenditures were financed primarily by issuing debt during the korean war expenditures were financed almost exclusively by higher taxes reflecting president truman s preference for balanced budgets this paper evaluates quantitatively the economic effects of the different policies used to finance these two wars counterfactual experiments are used to explore the implications of financing world war ii like the korean war and financing the korean war like world war ii the author finds that using a korean war policy during world war ii would have resulted in much lower output and welfare relative to the actual policy copyright 1997 by american economic association

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

words deeds and outcomes a survey on the growth effects of exchange rate regimes abstract recent studies on the growth effects of exchange rate regimes offer a wide range of different sometimes contradictory results in this paper we systematically compare three prominent contributions in this field using a common data set a common specification and common estimation methods we argue that the contradictory findings can be explained by the fact that these studies use regime classifications which reflect fundamentally different aspects of exchange rate policy