The Economic and Political Determinants of IMF and World Bank Lending in the Middle East and North Africa

Harrigan, Jane; El-Said, Hamed

doi:10.1057/9781137001597_2

Cited by 23 publications

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“…Although multilateral organizations such as the IMF and World Bank are explicitly prohibited from using political considerations as criteria for their aid, previous work shows that countries of strategic interest to the USA are more likely to receive aid from the Bretton Woods institutions (Thacker 1999;Fleck and Kilby 2006;Harrigan et al 2006). Moreover, recent work that focuses on IMF program participation (Stone 2004) shows that program conditions are less rigorously enforced on countries that are important to the IMF's major shareholders.…”

Section: Level Of Conditionality As An Alternative Explanationmentioning

confidence: 99%

When Does Aid Conditionality Work?

Montinola

2010

St Comp Int Dev

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Does aid conditionality-the setting of policy goals in exchange for access to aid-promote reform? Many studies on the impact of aid and reform suggest not. However, few explicitly examine whether the impact of aid on reform is mediated by recipient regime type. I argue that conditional aid is effective but its efficacy depends on recipient countries' level of democracy because the value of aid to governments depends on the degree to which it helps them maintain power, and recent work shows that the marginal impact of aid on political survival increases with level of democracy. I test this argument on data from 68 countries over the period from 1980 to 1999. I focus on the impact of IMF and World Bank aid on fiscal reform, one of the most commonly stipulated conditions in aid-for-policy arrangements. I find that aid from the Bretton Woods institutions promotes fiscal reform, but only in more democratic countries.

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Section: Level Of Conditionality As An Alternative Explanationmentioning

confidence: 99%

When Does Aid Conditionality Work?

Montinola

2010

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“…In Tunisia, the IMF program focused on stabilizing the macro economy by reducing expenditure to bring down inflation and close the current account deficit (Harrigan and El-Said 2009ap.105-147, IMF 1999, Pfeifer 1999. This was done using fiscal, monetary and exchange rate polices.…”

Section: The Stabilization Phase Of Reformmentioning

confidence: 99%

“…It moved away from direct control of credit and monetary expansion to use instead refinance facilities, with the inclusion of Treasury Bills in 1989. The latter led to a sharp decline in the growth of money supply (Harrigan and El-Said 2009a Figure 11). Non-preferential interest rates were liberalized and interest rate controls removed (World Bank 1995).…”

Section: The Stabilization Phase Of Reformmentioning

confidence: 99%

“…Overall, the stabilization program in Tunisia was a relative success leading to a significant degree of macro stability, restoration of a sustainable balance of payments and government budget, and no slump in the growth rate (in part thanks to a surge in EU demand for Tunisia's exports) (Harrigan and El-Said 2009a Table 11). There was an initial decrease in the growth rate between 1987 and 1988, but it quickly recovered by 1989.…”

Section: The Stabilization Phase Of Reformmentioning

confidence: 99%

“…In Morocco, there were elements of conflict between the IMF's demand side program aimed at reducing fiscal and current account imbalances by curbing demand and the World Bank's supply side program aimed at generating increased economic efficiency and export led growth (Harrigan and El-Said 2009ap.146-181, World Bank 1997, World Bank 2006. Fiscal deficit reduction under the IMF took precedence over the World Bank's attempt to reduce tariffs to stimulate export led growth via trade liberalization (World Bank 1990, Hamdouch 1990, Karshenas 1994.…”

Section: The Stabilization Phase Of Reformmentioning

confidence: 99%

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The Economic Impact of IMF and World Bank Programs in the Middle East and North Africa: A Case Study of Jordan, Egypt, Morocco and Tunisia, 1983 - 2004

Harrigan¹,

El-Said²

2010

Review of Middle East Economics and Finance

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This paper examines whether the economic reforms attached to IMF and World Bank policybased lending in the Middle East and North Africa have stimulated sustained economic growth. In order to investigate this, we chose four countries to study in depth: Jordan, Egypt, Tunisia and Morocco. These were chosen as they have been put forward by both the IMF and the World Bank as successful reformers who, for prolonged periods, carried out World Bank and IMF guided economic reform programs. We examine the sources of growth during the reform period in these four countries, looking at intensive versus extensive growth, growth in the tradables sector versus the non-tradables sector and growth caused by the reforms versus growth caused by exogenous factors. We discovered that the reform programs in all four countries were associated with spurts of economic growth, but that, apart from Tunisia, this was not sustained, with intensive growth in the tradables sector stimulated by the reform program.

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Geopolitics and the effect of foreign aid on economic growth: 1970–2001

Headey

2007

J of Intl Development

101

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Previous aid effectiveness research often claims that foreign aid has been unsuccessful in increasing growth rates. This result could be due either to methodological weaknesses, or to genuine aid efficiency losses. Empirically, the author finds that once the best available techniques are employed, aid has a significant but moderate average effect on growth over the period . A promising explanation of why the estimated returns to aid are not larger is that bilateral aid had no significant effect on growth during the Cold War (pre-1990), but had a significant and sizeable effect thereafter. In contrast, multilateral aid seems to have had sizeable and significant effects throughout. These results imply that the negative conclusions drawn by earlier research should be interpreted in their proper historical context, rather than as a necessary condemnation of current aid effectiveness.

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The Economic and Political Determinants of IMF and World Bank Lending in the Middle East and North Africa

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Cited by 23 publications

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When Does Aid Conditionality Work?

When Does Aid Conditionality Work?

The Economic Impact of IMF and World Bank Programs in the Middle East and North Africa: A Case Study of Jordan, Egypt, Morocco and Tunisia, 1983 - 2004

Geopolitics and the effect of foreign aid on economic growth: 1970–2001

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