IMF Lending and Socio-Economic Development: The Evolution and Consequences of Structural Adjustment, 1985-2014 (CBR project)

Centre for Business Research
Centre for Business Research

Overview

Aims and objectives

The general aim of this project is to develop the definitive assessment of the past 30 years of IMF-supported economic adjustment. The proposed project seeks to examine the evolving character of IMF-supported policies, document in detail country experiences with the IMF, and assess the effects of such policies on selected policy areas.  

Despite voluminous literature on the IMF – indeed, recent years have witnessed a rapid proliferation of regression-based studies on the effects of IMF programmes – the organisation’s practices remain insufficiently understood. This continuing lack of analytical clarity is a product of two substantial weaknesses in existing research. First, quantitative studies employ a simple dummy variable for IMF participation, despite the fact that IMF programmes vary dramatically in number, type and implementation of mandated policy reforms. Second, these studies are yet to be matched with in-depth case studies documenting how the IMF affects policy space and policy choices of developing countries.  

The project seeks to overcome these limitations by utilising a diverse range of sources, including archival data, interviews with stakeholders, and our newly developed data base on IMF conditionality (that is, policy reforms required to obtain funds), to provide an assessment of the organisation. The research will result in a series of journal articles, a book, and a range of impact activities. 

Background

After years of decline for its services, the International Monetary Fund (IMF) has recently experienced a revival. New lending has been plentiful, its capital was increased, and high-profile programmes – in Greece, the Ukraine and Tunisia – have placed it at the centre of the policy response to the global financial crisis. In addition, according to the IMF, the organisation has taken on-board criticisms and reformed past practices. For instance, the IMF’s Managing Director, Christine Lagarde, recently appeared puzzled by a journalist’s question: ‘Structural adjustments? That was before my time. I have no idea what it is. We do not do that anymore’.  

Given the re-emergence of the IMF as the central institution in directing and managing economic reforms across the globe, there is good reason to probe into these changes, put them in context, provide historical depth, and re-assess the relevant evidence. This project takes on this task, and utilises a mixed-methods approach and a battery of new data to examine three interrelated questions: How has the practice of IMF lending evolved over the past 30 years? What have been the correlates of IMF conditionality? What consequences have IMF programmes had on key issues (e.g. environment or health policy) and selected countries? This project aims to provide a definitive contribution to central debates concerning the IMF in international political economy and development studies.

Progress

Funding from CPEST ended concluded at the end of the 2017-18 academic year. The members of the research team produced a range of academic outputs that explore the consequences of structural adjustment programmes on state capacity, corruption, income inequality, labour rights, health systems, health outcomes, social expenditures and related topics. Over the three project years, the team published several articles and working papers, engaged with policymakers and civil society, and reached broader audiences through media articles and interviews.

Principal investigator

  • Larry King

Co-investigators

  • Alex Kentikelenis
  • Bernhard Reinsberg
  • Lori Smith
  • Thomas Stubbs

Project status

Ongoing

Project dates

2015-2018

Funding

Cambridge Political Economy Society Trust

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