IMF policy reforms weaken state capacity in developing nations, study finds | 3/19/2019 | Staff
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A new study shows that lending conditions imposed by the International Monetary Fund undermine "state capacity" in developing nations – preventing state bureaucrats from implementing essential policies in health, education, and national security.

Researchers from the Universities of Glasgow, Cambridge, Bocconi, and Royal Holloway analysed the IMF's loan documents to evaluate the relationship between IMF-mandated policy reforms and bureaucratic quality in developing countries.

Team - IMF - Documents - Policy - Conditions

The team collected over 4,500 loan-related IMF documents to identify policy conditions imposed on 131 borrowing countries between 1985 and 2014.

They found that public administrations become weaker when they need to implement "structural" reforms that target the public sector and the privatization of state-owned enterprises.

Authors - Study - Journal - Sociology - Findings

The authors of the study, published in the American Journal of Sociology, say their findings show the IMF neglects the harmful consequences of its policy advice on state capacity, and that IMF attempts to "shape political economies in the image of Western countries" are "misguided".

Dr. Bernhard Reinsberg, lead author of the study and lecturer in international relations since October 2018, said: "Much of the previous research on the...
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