The Impact of the IMF’s COVID-19 Support to Developing and Emerging Economies
IMF Working Papers, December 16, 2022
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- The Impact of the IMF’s COVID-19 Support to Developing and Emerging Economies
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Bibliographic details
- Authors: Sumin Chun, Karmen Naidoo, Nelson Sobrinho
- Published: December 16, 2022
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9798400229114.001
Dataset and Methodology
- Constructed a high-frequency dataset that combines information on all IMF lending and proxies of monthly economic activity during the first two years of the COVID-19 pandemic (2020–21).
- Applied standard econometric techniques to the novel dataset to estimate marginal effects of IMF financing on economic activity.
Main Findings
- Found a positive and significant marginal effect of IMF financing on economic activity in low-income countries (LICs) and emerging market economies.
- Evidence suggests IMF financing helped lessen the negative impacts of the pandemic on economic activity, especially in LICs.
- Presented tentative evidence that IMF financing may have improved economic outcomes by easing fiscal budget constraints.
Mechanism: Fiscal Response
- IMF financing appears to have allowed for larger government spending in response to the pandemic by easing fiscal budget constraints.
Subject Areas and Keywords
- Subject: Agroindustries, COVID-19, Economic sectors, Emergency assistance, Expenditure, Foreign aid, Health, Income, National accounts
- Keywords: Agroindustries, COVID-19, COVID-19 pandemic, Developing countries, Economic recovery, Emergency assistance, Emerging economies, External financing, Global, high-frequency dataset, IMF commitment, IMF disbursement, IMF lending, IMF's COVID-19 support, Income, Mobility, Nighttime lights
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- Working Paper