Four Decades of Fund Arrangements: Macroeconomic Stylized Facts Before the Adjustment Programs

Author/Editor:

Julio A. Santaella

Publication Date:

July 1, 1995

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This paper analyzes the initial conditions before Fund financial arrangements are adopted. Evidence from 324 Fund arrangements in 78 developing countries during 1973-91 indicates that there are important differences in the characteristics between program episodes and a control group. Program episodes exhibit weaker balance of payments, output growth, investment, external conditions and fiscal policy than the control group; they are also characterized by a higher degree of external indebtedness and inflation, and their exchange rates are more depreciated in both nominal and real terms. Only in the case of the growth rates of money and credit do the two groups appear to be statistically similar.

Series:

Working Paper No. 1995/074

Subject:

Central banks Domestic credit Exports External debt Foreign exchange International reserves International trade Money Real effective exchange rates

Notes:

Also published in Staff Papers, Vol. 43, No. 3, September 1996.

English

Publication Date:

July 1, 1995

ISBN/ISSN:

9781451849530/1018-5941

Stock No:

WPIEA0741995

Pages:

50

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