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Archive of Finance & Development (F&D) Issues:
Through an economic lens, what is Asia? At first blush, the answer seems simple: Asia is the locomotive of the world economy, posting impressive growth numbers for the past several decades. But a closer look reveals stunning diversity. Once you get past the headlines, the picture is complex and richly textured. This issue of F&D looks at Asia from a variety of angles, seeking to provide insight into the region’s economic present - and future.
Also in this issue, the costs and benefits of pegged exchange rates are tallied; the relationship between economics and virtue is explored; and researchers examine the point at which a nation’s debt compromises its medium-term growth. Finally, F&D's People in Economics series profiles Christopher Pissarides, whose pioneering work on unemployment and labor markets earned him the Nobel Prize in 2010.
The decision in 1951 by six European nations to pool coal and steel production paved the way for greater integration and, ultimately, lasting peace in Europe. What a great example of pursuing a long-term vision one step at a time-of not taking on too much at once. This issue of F&D examines Europe’s drive toward economic integration-the forces bringing it together and those pushing it apart.
Elsewhere in the issue, the People in Economics series profiles Lucrezia Reichlin, former Chief Economist at the European Central Bank and a pioneer of real-time economic forecasting. Other articles look at the impact of aging on policy choices, macroeconomic policy and natural disasters, and why the dollar is unlikely to be dethroned anytime soon as the world’s global reserve currency. This issue’s Back-to-Basics installment goes “old school” and takes a look at the monetarist school of economic thought.
Global trade remains an important and growing force in the world economy. Virtually every country on the planet now recognizes the role of trade in achieving higher economic growth and improved living standards. In this issue of F&D, we look at the various forces affecting global trade today—some of which offer new opportunities for poorer countries to become part of the global factory, while others present barriers to negotiating future trade deals.
Natural resources are a mainstay of many economies, and the revenue derived from their export can help countries fund the development projects that improve the lives of their citizens. This issue of F&D explores the world of natural resource management and puts forward new ideas for sustaining resource revenues over the long haul, to support steady economic growth.
• Our special feature kicks off with "Too Much of a Good Thing" by Chris Geiregat and Susan Yang, who examine the challenges facing resource-rich countries and advocate the use of a sustainable investing tool to help policymakers better allocate resource revenue.
Other articles cover natural resource booms, the promise of resource wealth to boost the frontier economies of central Asia, capital flight associated with the natural resource sector, and the future of oil markets.
June 2013: Women in Charge
• Ann Mari May explains how U.S. economists' views sometimes vary by gender, with potential implications for national policymaking in "Different Sight Lines."
This issue's People in Economics series offers a profile of economist Carmen Reinhart, whose research investigates the complexities of economic crises and capital flows, while the Back to Basics series looks at shadow banking and why many financial institutions that act like banks are not supervised like banks.
March 2013: Middle East - Looking Ahead
December 2012: Catalysts for Change
September 2012: The Global Village
June 2012: The Crisis and Beyond
March 2012: Youth Demanding Change
December 2011: "Africa's Middle-Class Motor" finds growing evidence that a recent resurgence in the continent's economic well-being has staying power. In his overview article, Harvard professor Calestous Juma says the emphasis for too long has been on eradicating poverty through aid rather than promoting prosperity through improved infrastructure, education, entrepreneurship, and trade. That is now changing: there is a growing emphasis on policies that produce a middle class. The new African middle class may not have the buying power of a Western middle class but it demands enough goods and services to support stronger economic growth, which, as IMF African Department head Antoinette Sayeh points out, in turn helps the poorest members of society. Oxford University economist Paul Collier discusses a crucial component of Africa's needed infrastructure: railways. It is a continent eminently suited to rail, development of which has been held back more by political than economic reasons. But even as sub-Saharan Africa thrives, its largest and most important economy, South Africa, has had an anemic performance in recent years. We also profile Ngozi Okonjo-Iweala, Nigeria's colorful economic czar. "Picture This" mines current trends to predict what Africa will look like a half century from now and "Data Spotlight" looks at increased regional trade in Africa. Elsewhere, Cornell Professor Eswar Prasad, examines a global role reversal in which emerging, not advanced, economies are displaying resilience in the face of the global economic crisis. The University of Queensland's John Quiggin, who wrote Zombie Economics, examines whether it makes sense in many cases to sell public enterprises. Economists Raghuram Rajan of the University of Chicago and Rodney Ramcharan of the U.S. Federal Reserve find clues to current asset booms and busts in the behavior of U.S. farmland prices a century ago."
September 2011: "All for One" examines inequality and the many ways it matters. In our overview article, the World Bank's Branko Milanovic explains how income inequality is measured and tells us that it's increased in most countries. The good news, he says, is that global inequality--between countries--could be on the decline. IMF economists Andrew Berg and Jonathan Ostry find that a more equal society has a greater likelihood of sustaining longer-term growth. Other IMF research on inequality finds that financial sector development not only "enlarges the pie" by supporting economic growth but divides it more evenly; that higher income inequality in developed countries is associated with higher indebtedness--at home and abroad; and that while fiscal consolidation is necessary in the medium term, slamming on the brakes too quickly can harm jobs and cut wages, exacerbating inequality. Also in this issue, we profile Elinor Ostrom, the first woman to receive the Nobel Prize for economics. In a tour of the globe, we look at how the African diaspora can help home countries from afar, try to draw some early lessons from the euro area's debt crisis, investigate how the United States and its neighbor Canada handled public debt--with different results, and find out about the rise of emerging markets as systemically important trading centers. Back to Basics explains the difference between micro- and macroeconomics, and Data Spotlight tells us about a new worldwide survey of foreign direct investment.
June 2011: "Wising Up to the Costs of Aging" looks at how falling fertility and rising life expectancy have combined to threaten the ability of many countries to provide a decent standard of living for the old without imposing a crushing burden on the young. In our lead article, Ronald Lee and Andrew Mason say that while population aging in rich industrial countries as well as in some middle- and lower-income countries will challenge public and private budgets in many ways, a combination of reduced consumption, postponed retirement, increased asset holdings, and greater investment in human capital should make it possible to meet this challenge without catastrophic consequences. Neil Howe and Richard Jackson publish a fascinating ranking of which countries are best and worst prepared to meet the needs of the growing wave of retirees. We also have articles on a broad range of current topics, including Middle East unemployment, the economic repercussions of the earthquake and devastating tsunami in Japan, and banking in offshore financial centers such as the Cayman Islands. Carmen Reinhart and Jacob Kirkegaard look at how governments are finding ways to manipulate markets to hold down the cost of financing huge public debts, and, in Straight Talk, the IMF's Min Zhu talks about the long-term challenges now facing emerging markets. Prakash Loungani speaks to Nobel Prize winner George Akerlof, and we discuss with three other laureates--Michael Spence, Joseph Stiglitz, and Robert Solow--what the global economic crisis has taught us. Back to Basics explains economic models, and Picture This highlights the great variations in the cost of sending money back home.
March 2011: "Latin America: An End to Boom and Bust?" covers prospects in that region, which has managed to sustain a decade of prosperity after a history of boom and bust cycles. In our cover story, Nicolás Eyzaguirre, Director of the IMF's Western Hemisphere Department, says Latin America has the potential to become an increasingly important global player. But boosting productivity and competitiveness remain key policy challenges and the fruits of success must be more broadly shared. Other articles on our cover theme look at the prospects for Brazil, inequality in Latin America, and how to raise productivity. Turning from Latin America, we interview former IMF Managing Director Michel Camdessus, now head of a group of luminaries tasked with generating ideas on how to make the global monetary system more stable in the wake of the world financial crisis. This issue of F&D also features articles on financial market cycles, public investment in infrastructure, whether to worry about inflation or deflation, democracy and liberalization, how to manage health care spending, and rising food prices. People in Economics profiles growth guru Robert Solow, winner of the 1987 Nobel Prize in economics. Our regular Back to Basics feature explains financial services. Data Spotlight looks at how access to financial services is growing in developing countries; and Picture This highlights the IMF's new database of public debt since 1880.
December 2010: This issue of F&D looks at the growing role of emerging markets. Analysis by the IMF's Ayhan Kose and Eswar Prasad, professor of trade policy at Cornell University, argues that their economic ascendance will enable emerging markets such as Brazil, China, India, and Russia to play a more significant part in global economic governance and take on more responsibility for economic and financial stability. And Vivek Arora and Athanasios Vamvakidis measure how China's economy is increasingly affecting the rest of the world not just its neighbors and main trading partners. In addition, F&D examines a variety of topics that are particularly relevant as the world struggles to shake off the crisis. Alan Blinder and Mark Zandi look at the positive effects of stimulus in the United States. Without it, they say, the United States would still be in recession. IMF researchers look at how countries can get debt under control, and what happens when government debt is downgraded. Other articles examine the human costs of unemployment, how inequality can lead over time to financial crisis, and what changes in the way banks do business could mean for the financial system. Two articles look at Islamic banking, which was put to the test during the global crisis and proved its mettle, and in Faces of the Crisis Revisited, we continue to track how the recession affected several individuals around the world. This issue of F&D profiles Princeton economic theorist Avinash Dixit in the regular People in Economics feature, and Back to Basics looks at externalities.
September 2010: "Restoring Hope: Reinvigorating the Millennium Development Goals" assesses how the world is doing in meeting the MDGs--international development targets that all UN member countries and many international organizations have set for 2015. Our lead article, "Regaining Momentum," says that while several of the MDGs are within reach, the global economic crisis has set back progress toward a number of the targets, especially those related to health. Developing countries will need the support of advanced economies to get back on track. Economist Jagdish Bhagwati calls into question the premise of the MDGs and argues that they should be rethought. Philanthropist Melinda Gates gives us the good news that maternal health has been improving, though we are not yet on track to meet the MDG target on maternal mortality. Picture This takes a look at child mortality rates and finds a more sobering picture. In related stories, economists Arvind Panagariya and Rodney Ramcharan have different views on how important it is to fight inequality. This issue also examines the deterioration of fiscal positions in advanced economies--as a result of both the global financial crisis and the long-run health and pension costs of an aging population. "How Grim a Fiscal Crisis?" argues that consolidation in advanced economies should focus on spending cuts, given the already high tax burdens in many countries. In "A Hidden Fiscal Crisis," economist Laurence J. Kotlikoff examines the serious budget issues in the United States. We also look at the expensive needs of a rapidly aging population in France, and steps China is taking to improve pensions and health care. People in Economics profiles Maria Ramos, the academic-turned Treasury-mandarin who had a central role in stabilizing the budget in South Africa. And the "Back to Basics" feature discusses unemployment.
June 2010: June 2010: “Asia Leading the Way” explores how the region is moving into a leadership role in the world economy. The issue looks at Asia’s biggest economy, China, which has relied heavily on exports to grow, and its need to increase domestic demand and to promote global integration if it is to continue to thrive. China is not the only Asian economy that heavily depends on exports and all of them might take some cues from the region’s second-biggest economy, India, which has a highly developed services sector. Min Zhu, the new Special Advisor to the IMF’s Managing Director, talks about Asia in the global economy, the global financial crisis, correcting imbalances, and the IMF in Asia. And “People in Economics” profiles an Asian crusader for corporate governance, Korea’s Jang Hasung. This issue of F&D also covers how best to reform central banking in the aftermath of the global economic crisis; the pernicious effects of derivatives trading on municipal government finances in Europe and the United States; and some ominous news for governments hoping to rely on better times to help them reduce their debt burdens. Mohamed El-Erian argues that sovereign wealth funds are well-placed to navigate the new global economy that will emerge following the world wide recession. “Back to Basics” explains supply and demand. “Data Spotlight” explores the continuing weakness in bank credit. And “Picture This” focuses on the high, and growing, cost of energy subsidies.
March 2010: “Prize or Penalty: When Sports Help Economies Score” looks at why countries vie to host the world’s most costly sporting events. And, in a series of articles on “After the Crisis,” we discuss why some countries were hit harder than others; how were shocks transmitted round the world, and whether protectionist pressures might intensify in 2010. As usual, we take on a number of hot topics, including housing prices, bankers’ bonuses, Ponzi schemes, and inflation targeting. In “Picture This” we see that the number of hungry is on the rise, topping 1 billion. Our regular “People in Economics” column profiles Daron Acemoglu, the Turkish-born intellectual who won the American Economic Association’s award in 2005 for the most influential U.S. economist under the age of 40. “Back to Basics” explains inflation; and “Data Spotlight” looks at how dollarization is declining in Latin America.
December 2009: “Climate Change: Stimulating a Green Recovery” looks at the global problem of climate change. With the world apparently on an economic recovery path, policymakers are looking at ways to limit the impact of climate change through broad international action. One of the challenges is to balance actions to mitigate climate change with measures to stimulate growth and prosperity. This issue of F&D also examines a variety of issues raised by the crisis—including the future of macroeconomics, explored by William White, former chief economist at the Bank for International Settlements, and the longer-term impact of the crisis on the United States, the world’s largest economy. Our “People in Economics” profile spotlights Joseph Stiglitz, the Nobel Laureate who “can’t get any respect at home.” We also look at the need for rebalancing growth in Asia, which is leading the world out of recession, and we interview five influential Asians on the region’s fragile rebound. We turn our “Straight Talk” column over to Barbara Stocking of Oxfam, who makes a forceful case for stepping up help to the most vulnerable around the world. “Data Spotlight” looks at trends in inflation, which has fallen into negative territory in some countries during the crisis, and in “Point-Counterpoint,” two experts discuss the pros and cons of remittances—funds repatriated by migrant workers to family and friends back home. “Back to Basics” gives a primer on international trade."
September 2009: Recovery from the deepest recession in 60 years has started. But sustaining it will require delicate rebalancing acts, both within and across countries. IMF chief economist Olivier Blanchard writes in our lead article that the turnaround will not be simple. The crisis has left deep scars that will affect both supply and demand for many years to come. This issue of F&D also looks at what’s next in the global crisis and beyond. We look at ways of unwinding crisis support, the shape of growth worldwide after the crisis, ways of rebuilding the financial architecture, and the future of reserve currencies. Jeffrey Frankel examines what’s in and what’s out in global money, while a team from the IMF’s Research Department looks at what early warning systems can be expected to deliver in spotting future problems. In our regular People in Economics profile, we speak to Nobel prize winner Daniel Kahneman, whose work led to the creation of the field of behavioral economics, and our Picture This feature gives a timeline of how the Bank of England’s policy rate has fallen to its lowest level in 300 years. Back to Basics gives a primer on monetary policy, and Data Spotlight looks at how the crisis has affected the eastern European banking system.
June 2009: 'Crisis Shakes Europe: Stark Choices Ahead' looks at the harsh toll of the crisis on both Europe's advanced and emerging economies because of the global nature of the shocks that have hit both the financial sector and the real economy, and because of Europe's strong regional and global trade links. Marek Belka, Director of the IMF's European Department, writes in our lead article that beyond the immediate need for crisis management, Europe must revisit the frameworks on which the European Union is based because many have been revealed to be flawed or missing. But in many respects, one key European institution has proved its mettle—the euro. Both Charles Wyplosz and Barry Eichengreen discuss the future of the common currency. Also in this issue, IMF economists rank the current recession as the most severe in the postwar period; John Lipsky, the Fund's First Deputy Managing Director, examines the IMF's role in a postcrisis world; and Giovanni Dell'Ariccia assesses what we have learned about how to manage asset price booms to prevent the bust that has caused such havoc. In addition, we talk to Oxford economist Paul Collier about how to help low-income countries during the current crisis, while Donald Kaberuka, President of the African Development Bank, writes about how African policymakers can prepare to take advantage of a global economic recovery. 'Picture This' looks at what happens when aggressive monetary policy combats a crisis; 'Back to Basics' gives a primer on fiscal policy; and 'Data Spotlight' takes a look at the recent large swings in commodity prices.
March 2009: 'Crisis Stalls Globalization: Reshaping the World Economy' examines the multiple facets of the recession--from the impact on individual economies to the effect on the external accounts of the world’s lenders and borrowers--and offers a variety of suggestions for supporting a recovery and averting future crises. Several IMF studies shed light on the depth of the crisis--including a survey of the sharp drop in trade finance, along with quantitative findings about the direct and indirect costs of the financial turbulence--and debate what is to be done from several angles, including the redesign of the regulatory framework and ways to plug large data gaps to prevent future crises and aid in the creation of early warning systems. Opinion pieces discuss the shifting boundaries between the state and markets, the agenda for financial sector reform, and the governance of global financial markets. The issue also includes a historical perspective to see when restructuring the global financial architecture actually succeeds. 'People in Economics' profiles Nouriel Roubini; 'Back to Basics' looks at what makes a recession; and 'Data Spotlight' examines Latin America's debt.
December 2008: "Cracks in the System: World Economy Under Stress" explores the rapidly changing institutional and policymaking landscape around a financial crisis that now threatens a deep and prolonged global recession. The lead article looks at how the world got into the mess and what to do about it, both now and over the medium term. Other articles review options for changing the rules of world finance, examine the case for modernizing the way countries coordinate their policies, and try to draw some lessons from past financial crises. The "other crisis" of high food and fuel prices is also assessed, as the effects extend past the mid-2008 price peak. "People in Economics" profiles Robert Shiller; "Picture This" illustrates how middle-income economies can reach high-income status; "Back to Basics" looks at all the components that make up gross national product; and "Country Focus" spotlights Saudi Arabia.
September 2008: Examines key issues facing low-income countries, including how they should respond to high oil and food prices. Some African economies are now successfully attracting international investors and are seen as a new tier of frontier emerging markets. Separate articles look at problems of aid effectiveness, aid predictability, and aid fragmentation. Other articles include an account by Eswar S. Prasad and Raghuram G. Rajan of their new report on financial sector reforms in India; Martin Ravallion and Dominique van de Walle draw lessons on reducing poverty from Vietnams agrarian reforms; Sanjeev Gupta and Shamsuddin Tareq make a strong case for sub-Saharan countries to mobilize their domestic revenue bases. In addition, Simon Willson profiles Beatrice Weder di Mauro, the first woman on Germanys Council of Economic Experts; and the outgoing IMF Chief Economic Simon Johnson talks about the new drivers of global growthemerging markets.
June 2008: The June 2008 issue tackles the crisis in financial markets in industrial countries from a number of angles. Articles look at the origins of the crisis in the subprime mortgage market in the United States and track its spillover into other markets. Then authors examine what can be done to prevent future crises. Other articles look at bank capital adequacy rules and Basel II, whether emerging markets and industrial economies are decoupling or converging, capital flows to low-income countries, efforts to achieve the MDGs, and currency intervention. Back to Basics looks at over-the-counter (OTC) markets and the People in Economics column profiles Jacques Polak. Picture This is on the digital divide.
March 2008: 'Commodity Boom: How Long Will It Last?' asks how economies will fare after the record-high prices of key raw materials posted in recent months, which build on dramatic increases from their lows of 2000. The lead article warns that the impact on headline inflation levels might persist throughout 2008, even without further commodity price hikes. It urges policymakers to ensure efficient functioning of market forces at the global level, and to move swiftly to protect the poorest. Another article addresses the effects of climate change on agriculture, warning that farm production will fall dramatically—especially in developing countries—if steps are not taken to curb carbon emissions. Other articles on this theme argue that policies to reduce greenhouse gas emissions need not hobble economies, and that financial markets can help address climate change. 'People in Economics' profiles John Taylor; 'Picture This' says the global energy system is on an increasingly unsustainable path; 'Country Focus' spotlights South Africa; and 'Straight Talk' examines early warnings provided by credit derivatives. Also in this issue, articles examine China's increasing economic engagement with Africa, and the outsourcing of service jobs to other countries.
December 2007: 'Global Governance: Who's in Charge?' examines the challenges—financial, health, environmental, and trade—facing the international community in the 21st century and asks whether today';s system of global governance is equipped to cope with them. The lead article asserts that the system that served as a model for much of the 20th century is out of date, and it explores what needs to be done to strengthen it. Other articles on this theme look at the recent U.S. subprime market crisis, the differences between financial crises of the 19th and 20th centuries and what future crises will look like, the need for a stronger system of multilateral trade, and how global health threats can be handled. 'People in Economics' profiles Michael Kremer; 'Picture This' describes the changing aid landscape; 'Country Focus' spotlights the United Arab Emirates; and 'Straight Talk' examines the impact of high food prices. Also in this issue, articles examine development in Africa, and 'backcasting' data in Latin America.
September 2007: The September 2007 issue of F&D looks at the growth of cities and the trend toward urbanization. Within the next year, for the first time in history, more than 50 percent of the world's population will be living in urban rather than rural areas. What are the economic implications of this urban revolution? Economists generally agree that urbanization, if handled well, holds great promise for higher growth and a better quality of life. But as the lead article tells us, the flip side is also true: if handled poorly, urbanization could not only impede development but also give rise to slums. Other articles in this series look at poverty as an urban phenomenon in the developing world and the development of megacities and what this means for governance, funding, and the provision of services. Another group of articles discusses the challenge of rebalancing growth in China. 'People in Economics' profiles Harvard economist Robert Barro; 'Country Focus' looks at the challenges facing Mexico, and 'Back to Basics' takes a look at real exchange rates.
June 2007: The June 2007 issue of F&D spotlights gender equality. The lead article discusses progress toward fulfilling the Millennium Development Goal (MDG) on redressing gender discrimination and empowering women and related MDGs. The section also looks at how budgeting with gender issues in mind can help countries promote gender equality and what needs to be done to get girls from 'excluded' social groups into school. Other articles focus on Asia 10 years after the financial crisis, the implications of China's and India's growing ties with Africa, and making remittances work for Africa. 'Country Focus' looks at the challenges facing Bulgaria now that it has joined the European Union, 'Picture This' highlights the globalization of labor, and 'Back to Basics' gives a primer on microfinance. Two other pieces discuss the efficiency of public spending in Latin America and how countries can use the public sector balance sheet approach to diagnose vulnerabilities that are not immediately visible in the budget.
March 2007: "The Two Faces of Financial Globalization" looks at the phenomenon of rising cross-border financial flows-credited with boosting growth in developing countries but also blamed for the emerging market crises of the late 1980s and 1990s. The lead article puts together a framework for analyzing studies about the costs and benefits of financial globalization. Other articles look at the worldwide allocation of capital, the role of finance in macroeconomic management, and changes in the investor base. "Picture This" illustrates the growth and direction of capital flows. One guest contributor describes India's capital account liberalization, and another looks at how participants in international finance can cope with a fluid financial landscape. "People in Economics" profiles Guillermo Calvo; "Back to Basics" explains the difference between the purchasing power parity exchange rate and market exchange rates as measures of global economic growth; and "Country Focus" spotlights Australia.
December 2006: 'Africa: Making Its Move' explores some of the obstacles facing sub-Saharan Africa as it attempts to capitalize on changes that offer fresh opportunities for growth and poverty reduction. The lead article describes the changes and suggests how Africa can build on them to progress further. Other articles focus on the aid situation, financial sector development, trade, the business environment, and political and policy reform on the continent. 'Country Focus' examines the Central African Economic and Monetary Community, and two guest contributors look at how the international community can help the most fragile states and how oil-producing countries can manage windfall revenues. 'People in Economics' profiles the European Central Bank's first chief economist, Otmar Issing; 'Picture This' examines the global housing slowdown; and 'Back to Basics,' explains current account deficits. Another article discusses the realities of health financing.
September 2006: The Economics of Demographics provides a detailed look at how the biggest demographic upheaval in history is affecting global development. The issue explores demographic change and the effects of population aging from a variety of angles, including pensions, health care, financial markets, and migration, and looks specifically at the impact in Europe and Asia. Picture This looks at global demographic trends, while Back to Basics explains the concept of the demographic dividend. Country Focus spotlights Kazakhstan, while People in Economics profiles Nobel prize winner Robert Mundell. IMF Economic Counsellor Raghuram Rajan argues for further change in India's style of government in his column, Straight Talk.
June 2006: Asia Rising -- explores Asia's role in the world economy, the challenges faced from globalization, the quest for greater regional financial integration, the problem of lagging investment, and why East Asia performed so much better than Latin America. It also looks at the recovery of Japan and the rise of India and China. The economies of the ASEAN-4 come under the microscope in Country Focus. Other articles examine financial sector reform in Africa and the remaining hurdles to financial integration in the European Union. People in Economics profiles Paul Krugman, Back to Basics focuses on hedge funds, and the Straight Talk column looks at the problem of underdevelopment.
March 2006: For policymakers around the world, finding ways to promote faster growth is a top priority. But what exactly do economists know and not know about growth? What direction should future research and policymaking take? This issue explores this topic, starting with a major World Bank study and research coming out of Harvard University that urges less reliance on simple formulas and the elusive search for best practices, and greater reliance on deeper economic analysis to identify each country's binding constraint(s) on growth. Other articles highlight IMF research on pinpointing effective levers for growth in developing countries and Africa's experience with growth accelerations. Also in the issue are pieces examining global economic imbalances, rapid credit growth in Eastern and Central Europe, and ways to boost productivity growth in Europe and Japan. In Straight Talk, Raghuram Rajan argues that if we want microfinance to become more than a fad, it has to follow the clear and unsentimental path of adding value and making money. Asian Development Bank's Haruhiko Kuroda sets out his vision for a new financial architecture in Asia. Finally, Picture This takes an in-depth look at global employment trends.
December 2005: "Latin America: A Time of Transition" is an in-depth look at the region's economic prospects and policy issues. The lead article argues that Latin America has a fresh chance to entrench growth and break the cycle of crises. Other articles examine the political and economic choices facing the region of half a billion people during an election period, the problem of persistent poverty, and the difficulties faced by the region's indigenous peoples. Country Focus spotlights Peru, while People in Economics profiles Latin American development economist Nora Lustig. Back to Basics and Picture This jointly examine remittances. Articles also cover equity in development, spending on HIV/AIDS, Islamic finance, and the chequered history of aid.
September 2005: Can more aid really make poverty history as aid campaigners have argued? This issue examines aid effectiveness and how to build momentum toward the Millennium Development Goals after the G8 vowed to double aid to Africa. Includes assessments of use of aid in Ethiopia, Ghana, Mozambique, Tanzania, and Uganda, as well as viewpoints from Burkina Faso, Tanzania, and the UK. Other articles look at next steps for reform in China, and how trading partners can help each other's growth. Profile of Jagdish Bhagwati and IMF Economic Counsellor Raghuram Rajan examines global financial risk. Also a look at governance and measures to combat corruption.
June 2005: This issue of F&D takes stock of the enormous gains that have been made on the educational front over the past century and examines what still needs to be done if education for all is to become a reality, as pledged by the global community at the United Nations Millennium Development Conference in 2000. Five years later, East Asia and the Pacific, and Latin America and the Caribbean are close to achieving the goal of universal primary education by 2015, but sub-Saharan Africa continues to lag far behind. Other articles look at capital market development - or the lack thereof - in Latin America, and at Brazil's economic success. In Straight Talk, Raghuram Rajan takes on yet another contentious topic: how to achieve optimal debt relief for poor countries. In People in Economics, Mario Monti reflects on his time as Europe's Commissioner for Competition and discusses Europe's future. Finally, Country Focus gives a snapshot of Turkey's economy.
March 2005: This issue dissects the fears and apprehensions that small, poor countries have when it comes to engaging in the world trading system. With the Doha Development Round at a critical juncture, developing countries must decide whether to fight to keep their preferential trade access to a few key developed country markets or engage in multilateral liberalization. Other articles look at how the IMF must change to stay relevant in the 21st century; and how improving the investment climate is key to economic growth. In The Book Review Section, Nancy Birdsall and Moises Naim debate Sebastian Mallaby's controversial book about the World Bank and its president, James Wolfensohn. Finally, People in Economics tells the story of Bodil Nyboe Andersen, Denmark's central bank governor.
December 2004: The cover story takes a look at the proposal for a single currency for Africa. Other articles delve into a range of development issues, including possible lessons from China's success in combating poverty; the nuts and bolts of how countries can move to a floating exchange rate; possible new approaches to fiscal accounting; and the benefits of debt relief. An IMF study on services outsourcing finds that the numbers do not support the hype over job losses, while an article on corruption argues that a lack of progress in eradicating it could be due to misguided strategies. Picture This looks at the possible benefits to agriculture from the Doha round of trade talks. The Country Focus is on Brazil and People in Economics profiles Linah Mohohlo, the award-winning central bank governor of Botswana.
September 2004: Marking the IMF's 60th anniversary, this issue explores the forces that are likely to shape the global economy over the next 25-50 years and how the IMF will prepare itself to meet the consequent challenges. It also looks at reforms the IMF will need to implement if it is to retain its political legitimacy. L. Van Houtven discusses IMF governance and the need to overhaul the Executive Board. C. Rustomjee also argues for reforming the Board to increase the representation of developing countries. Three former IMF Managing Directors share their views on improving IMF governance, strengthening IMF surveillance, and preventing crises. The issue also features a profile of Nobel Prize-winner Amartya Sen; Country Focus on Nigeria's economy; and three articles on development issues. One discusses the implications of recent initiatives calling for more foreign aid in the form of grants rather than loans. The IMF's Raghuram Rajan explores the pitfalls of relying on orthodox economic models for policymaking.
June 2004: Focuses on the economic challenges facing the European Union (EU) following the accession of 10 new members on May 1. The main challenge, weak growth, entails tackling such deep-rooted problems as a lack of competitiveness and unemployment. This issue also looks at the EU’s Stability and Growth Pact, the single European currency, the implications of population aging for Europe, problems over migration between the established EU members and the new members, and viewpoints on the EU’s enlargement. This issue also presents some recent developments in microfinance, including a recent experimental project in which banks on wheels have brought financial services to Vietnam’s poorest citizens and the evolution of microfinance institutions that provide flexible, high-quality financial services to low-income clients on a sustainable basis. Other contributions include a Country Focus on the Indian economy, a celebration of 40 years of F&D, an inside account of the successful restructuring and privatization of Seoul Bank in 2000-02, and a profile of Brookings Senior Fellow Alice Rivlin.
March 2004: Explores the important links between health and economic progress. The past century has been marked by rapid advances in human welfare. People in most parts of the world are healthier and are living longer. While these trends are likely to continue, hopes are fading in some regions where progress slowed or went into reverse in the 1990s, primarily as a result of the AIDS epidemic. David E. Bloom, David Canning, and Dean T. Jamison discuss the trends. The issue also examines the progress made by the new IMF watchdog—the Independent Evaluation Office—in probing the effectiveness of the IMF. Princeton's Peter Kenen, a seasoned watcher of the Bretton Woods institutions, reviews the IEO's work. Other contributions include: a Country Focus on the U.S. economy; an interview with Martin Feldstein; a look at globalization, past and present, by Alan Taylor; and the latest thinking on antimalarial drugs by Kenneth Arrow. Raghuram Rajan, the new Director of the IMF's Research Department, launches his column by examining dollarized debt and "original sin."
December 2003: The issue focuses on the Millennium Development Goals and what it will take to achieve these globally adopted targets that center on halving the 1990 incidence of extreme poverty by the year 2015. The main article is based on a World Bank study of 18 low-income countries with relatively good policies. Separate articles look at debt sustainability, external shocks, and fiscal policy in low-income countries. Other articles examine financial systems in the CIS-7 countries and China’s integration into the global trading system. Hernando de Soto is interviewed for the People in Economics section, while Picture This focuses on the world’s forests. Kenneth Rogoff sees the past decade of global disinflation as an unsung benefit of globalization, while the Country Focus section examines the economies of the Commonwealth of Independent States.
September 2003: Articles on moving beyond the Washington Consensus and redrafting the reform agenda by John Williamson, Guillermo Ortiz, and Trevor A. Manuel. One article from the World Bank based on the -World Development Report 2003/2004- on improving service delivery to the poor, and a joint IMF-World Bank article on what needs to be done to accelerate progress toward the Millennium Development Goals. Two articles on what developing countries can do to protect themselves against natural disasters. Other articles on monetary regime options for Latin America, central bank intervention in volatile foreign exchange markets, assessment of offshore financial centers, long-term fiscal challenges confronting countries, and income inequality. Profile of development economist Esther Duflo. Kenneth Rogoff's column on why the IMF needs to do more whistle-blowing and less cheerleading when countries seem to be headed for trouble. Statistics on the Middle East and North Africa. Book reviews.
June 2003: The issue focuses on inflation and the role of institutions in development. Three articles look at disinflation, hyperinflation, and deflation. A new feature, “Country Focus,” provides a snapshot of Japan’s stagnant economy while “Back to Basics” examines the increasingly popular practice of inflation targeting. Four articles examine the part institutions play in development, compared with other factors such as geography and resource endowments. F&D interviews Professor Allan H. Meltzer to get his views on the international financial institutions, especially the IMF, three years after the release of the controversial U.S. congressional report that bore his name. In “Straight Talk,” Kenneth Rogoff, the IMF’s Economic Counsellor and Research Department Director, argues that the UN Millennium Development Goals are valuable but not as an all-encompassing framework for long-term growth.
March 2003: The issue focuses on the Middle East and North Africa: the problems it faces, the reasons its economic performance has been disappointing over the past decade, and the measures it could take to become better integrated with the global economy. Articles explore the region’s social policies, high unemployment rate, large and inefficient public sectors, underdeveloped financial sector, exchange rate regimes, and dominant role in world energy markets. Two other articles look at the political economy of oil-exporting countries worldwide and describe how they can protect themselves against fluctuating oil prices and dwindling reserves, while a third describes how the currencies of commodity-dependent countries are affected by fickle commodity export prices. Two new features are introduced with this issue: “People in Economics,” which profiles Nobel Prize winner Vernon Smith; and “Back to Basics,” which delves into the concept of Dutch disease. In his regular column, Kenneth S. Rogoff, the IMF’s Economic Counsellor and Director of the IMF’s Research Department, explains why he opposes the rigid coordination of dollar, yen, and euro monetary policy.
December 2002: The main theme is the prevention, management, and resolution of financial crises. Articles discuss new techniques for predicting crises, such as early warning systems; describe various indicators of vulnerability, including high levels of debt and mismatches between assets and liabilities on a country's balance sheets; outline possible ways to resolve crises when they do occur; and explain the importance of granting independence to financial regulators. Other articles cover the fiscal impact of aid, the informal system for transferring funds known as hawala, prolonged use of IMF loans, the challenges facing small states, the monetary union to be formed by the Cooperation Council of the Arab States of the Gulf, the role of legislatures in poverty reduction, the economic impact of armed conflict and terrorism, and the economic impact of corruption and poor governance. In his regular column, Straight Talk, Kenneth Rogoff, IMF Economic Counsellor and Director of the IMF's Research Department explores the question of capital controls.
September 2002: Main theme is trade liberalization. Point of View by former WTO director-general Peter Sutherland on the benefits of globalization. Article co-authored by IMF Deputy Managing Director Anne Krueger on why trade openness can help curb poverty. Also, articles on the Doha development agenda, the importance of increased market access for developing countries, industrial country tariffs, the implications of China's membership in WTO, and the impact of globalization on income inequality in China. Other subjects covered in the issue are capital surges in transition countries, the embattled energy sector in the Commonwealth of Independent States, the future of pension reform in Latin America, the international community's fight against money laundering and the financing of terrorism, and the challenges of the e-banking revolution. In his regular column, Kenneth Rogoff, IMF Economic Counsellor and Director of the IMF's Research Department, enters the debate on whether IMF loans create moral hazard.
June 2002: Main theme is poverty reduction. Point of View by Professor Angus Deaton of Princeton University on reliability of poverty counts. Overview on new approaches to poverty reduction followed by articles covering recent reviews of the IMF/World Bank Poverty Reduction Strategy Paper approach and the IMF’s Poverty Reduction and Growth Facility, as well as an article on the preparation of Bolivia’s Poverty Reduction Strategy Paper bringing together the views of five participants. Other articles on how financial crises affect income distribution and the poor, the need for automatic safety nets, the streamlining of IMF conditionality in new loans, the impact of external debt on growth, the issue of whether countries should be obligated to repay “odious” debt incurred by their leaders, and the challenges of expanding aid flows to poor countries with small economies. On other subjects, articles on the popular value-added-tax and the lessons from a decade of transition in Eastern Europe and the former Soviet Union. In his regular column, Straight Talk, Kenneth Rogoff, IMF Economic Counsellor and Director of the IMF’s Research Department explores the volatility of G-3 exchange rates.
March 2002: Main theme is the shape of global integration. In addition to an overview on the challenges of globalization by IMF Deputy Managing Director Eduardo Aninat and a debate between Kevin Watkins of Oxfam and two World Bank economists on the impact of globalization on the poor, there are articles on financial globalization, financial stability in the world of global finance, the impact of G-3 exchange rate volatility on developing countries, September 11 and the U.S. payment system, the economic implications of global warming, the international develoment goal of universal primary education for all children by 2015, AIDS as part of the global development agenda, and the silent revolution of the 1980s. Other articles deal with southeastern Europe after the Kosovo Crisis and the institutions developing countries need to support their fledgling market economies. Introduction of a new feature that will appear in every issue, a column by Kenneth Rogoff, IMF Economic Counsellor and Director of the Research Department; the subject in this issue is the popularity of paper currency.
December 2001: Eleven articles on globalization and Africa: the steps the continent is taking to meet the challenges, maximize the benefits, and minimize the risks. Other articles on IMF conditionality, human rights and the IMF, international trade and poverty reduction, oil funds, whether or not foreign investors have contributed to financial crises in emerging market countries by acting like a panic-prone herd, and a new book on John Maynard Keynes. A point of view piece by Robert Hunter Wade on the rising inequality of world income distribution.
September 2001: Three articles on social sector reforms: social sector reform in transition countries, the truth about pension reform, and debt relief and public health spending in heavily indebted poor countries. Three articles on transition countries: state capture, intergovernmental relations in Russia, and an initiative for institutional reform in Odessa. Other articles on the links between trade, growth, and poverty; the Suez Canal crisis in 1956; lessons from California's power crisis; the global digital divide; public-private partnerships; and water management in the Middle East. A Point of View piece by Jagdish Bhagwati on rich-country protectionism.
June 2001: Three articles on capital flows and foreign direct investment, articles by Stanley Fischer on the bipolar view of exchange rate regimes and by Ronald McKinnon on the impact of U.S. tax cuts on the world economy, and three articles on transition economies. Also an article by Paul Streeten on integration, interdependence, and globalization, and other articles on the impact of the "new economy" on the United States and other industrial countries, the role of private enterprises in reducing poverty in developing countries, macroeconomic policies and poverty reduction, IMF financing and moral hazard, and how private sector lenders have adapted to the resolution of financial crises.
March 2001: Six articles on reform and restructuring in Asia. Other articles on the role of capital in development, the effect of globalization on tax systems, poverty in Latin America and the Caribbean, economic stabilization in the Caribbean, and transition in Poland. Three articles present two points of view on expanded monetary union in West Africa, an inside view of the IMF's dialogue with nongovernmental organizations, and a useful tool to help developing countries secure foreign finance.
December 2000: A special focus on the issue of "How We Can Help the Poor," with articles on ways to broaden the agenda for poverty reduction; the ongoing and often hollow debate on growth versus poverty reduction; the international community's response on supporting poverty reduction; progress toward international development goals; the powerlessness of the poor; rural poverty; the distinct problems facing Africa; and issues of debt relief. Other articles deal with proposals for a new global banking standard and the role of short-term debt in recent crises.
September 2000: Focus on the transition countries. After an overview of the progress made since transition began in the early 1990s, 11 articles on specific countries or groups of countries and on challenges faced by these countries, such as joining the European Union, building treasury systems from scratch, and conducting monetary policy. Other articles on monetary regimes and inflation targeting, macroeconomic indicators as tools for assessing financial system soundness, and the U.S. debate on funding the IMF. A special supplement covering the economy of the Czech Republic, site of the 2000 IMF-World Bank Annual Meetings; and two IMF reports to be released this fall, World Economic Outlook, and International Capital Markets Report.
June 2000: Four articles on the battle against corruption, and four articles on trade and developing countries. Other articles on prospects for emerging markets, European labor markets and EMU, the changing world of banking, agricultural development banks, and the IMF's template for reporting on international reserves.
March 2000: An article by the IMF's Historian on Michel Camdessus's tenure as Managing Director of the IMF; nine articles on economic reform and recovery in Latin America and the Caribbean since the financial crises of the late 1990s, including four articles by finance ministers and central bank governors of Latin American countries; other articles on the sustainability of the U.S. current account deficit, the rise and fall of Albania's pyramid schemes, and the importance of orderly and effective insolvency procedures.
December 1999: Nine articles discussing issues for the new millennium, including an interview of distinguished economist John Kenneth Galbraith and articles on trade, liberalization, the changing development landscape, the importance of human development in development strategies, decentralization of governance, and governance in the digital economy. Other articles focus on issues in financial markets, such as the changing nature of risk and integrated financial supervision, and tobacco control.
September 1999: The reform of the international financial architecture--building transparency, developing financial standards, liberalizing the capital account, and adapting the international financial institutions--is the subject of five articles in this issue. Other articles deal with issues in the international monetary system, problems of transition, commodity prices, and the aftermath of the Asian financial crisis.
June 1999: Seven articles discussing key issues in transition economies, including lessons of the Russian crisis (by former Russian Prime Minister Yegor Gaidar), inflation, growth, privatization, and the changing role of government. Other articles focus on the Asian crisis, the challenges of financial globalization for developing and transition countries, the predictability of currency and banking crises, the impact of the euro on Latin America, and the brain drain from developing to developed countries.
March 1999: Challenges facing sub-Saharan Africa and the region's future prospects are the subject of four articles. In addition, articles on monetary policy in the euro area, deposit insurance, capital flows, corporate restructuring in Asia, and contingent government liabilities.
December 1998: December 1998 Discusses the far-reaching implications of European Economic and Monetary Union (EMU). Other topics include capital account liberalization; dealing with financial crisis; monetary policy and currency boards; and the evolution of IMF conditionality.
September 1998: Economic Policy and Equity, The Asian Crisis, Transition Countries--Articles by Vito Tanzi; Sanjeev Gupta, Benedict Clements, and Erwin Tiongson; IMF Area Department Directors; Patrick Lenain; Julian Exeter and Steven Fries; Dale Gray; Christoph B. Rosenberg and Tapio O. Saavalainen; James M. Boughton; Jan Aart Scholte; Philip Gerson; and IMF Staff
June 1998: The Asian crisis and its implications for the global economy--articles by Stanley Fischer, Guillermo Ortiz, John Lipsky, and Manuel Guitián. Other articles discuss Asia's aging societies, infrastructure development in Asia, private investment in the West Bank and Gaza Strip, the impact of bribery in international commerce, and the prospective role of the euro as an international currency.
March 1998: The problem of corruption worldwide; AIDS--economic implications, role of governments, priorities in prevention; civil liberties, democracy, and the performance of government projects; two articles on inflation; biodiversity in agricultural development; distance education; and currency crises and the role of monetary policy.
December 1997: Aid spurs growth--in a sound policy environment; capital flow sustainability and speculative currency attacks; sovereign debt: managing the risks; IMF monetary model; are international labor standards needed to prevent social dumping?; explaining the dividend yield in the U.S.; job uncertainty, unemployment, and inflation in the U.S.; private participation in infrastructure; new initiative to promote clean coal; developing rural financial markets; Egypt: poised for sustained growth?; and can public pension reform increase saving?
September 1997: Hong Kong, China in transition; maturation of the East Asian miracle; Japanese foreign direct investment and regional trade; reforming legal systems in developing and transition countries; the state in a changing world; how can states foster markets?; improving the state's institutional capability; financial sector reforms in Morocco and Tunisia; experience under the IMF's ESAF; decentralizing government; efficient public sector downsizing; the Real plan, poverty, and income distribution in Brazil; and impact of EMU on European securities markets
June 1997: How can sub-Saharan Africa attract more private capital inflows?; financial liberalization in Africa and Asia; tackling the rural energy problem in developing countries; Japan's economy needs structural change; bias in the U.S. consumer price index; growth and the environment; the reform of wholesale payment systems; creditors' crucial role in corporate governance; interest rates: approach to liberalization; developing countries get more private investment, less aid; improving India's saving performance; Islamic financial systems; and education and health care in the Caribbean.
March 1997: Causes of capital inflows and policy responses to them; money laundering, rating the raters of country creditworthiness; Stanley Fischer on financial system soundness; what happened to the peace dividend?; How Indochina's economies took off; statistical discrepancies in the world current account; international joint ventures in developing countries; how tax systems treat men and women differently; private capital in water and sanitation, economic growth and income inequality; the banking crises in the Baltics; and economic trends in the developing world.
December 1996: The new environmentalism; risk management in financial and foreign exchange markets; central banks and price stability; economic forecasting; sub-Saharan Africa’s marginalization in world trade; private sector development in the Visegrad countries; the urban poor in developing countries.
September 1996: Government reform. EU--Mediterranean strategy; agricultural water pollution. Transition economies--global integration; education and health care. Also, monetary policy in EMU; warehouse receipts; social assistance in Germany; pension reform in Costa Rica; disparities in global integration.
June 1996: Energy policy; the Tobin tax; the impact of adjustment on growth; pension debt; revenue decline in the former Soviet republics; the IMF’s data standards; widening income gap between rich and poor countries; the economic importance of collateral; stock market development and corporate finance; urbanization.
March 1996: March 1996 Banking and monetary reform; globalization and the developing countries; exchange rate regimes and inflation; growth and financial stability in the Middle East and North Africa; and convergence of economic conditions in India’s states.
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