آیا خوشحالی بازمی گردد؟ بازگشت و صندوق بین المللی پول

IMF programs are designed to provide a temporary source of finance for countries with balance of payments disequilibria. Consequently, borrowing from the IMF should occur infrequently and be widely distributed among member countries. However, some countries are recurrent users of Fund resources. This paper investigates which variables account for multiple borrowings from the IMF. We use models of count data to examine the impact of the need for financing, domestic policies, external shocks, and structural and institutional factors on borrowings between 1980 and 1996. We find that recidivist borrowers have lower reserve holdings, larger current account deficits and capital outflows, lower but less volatile terms of trade, larger debt service and external debt ratios, lower investment rates and per-capita income, and weak governance.

The International Monetary Fund (IMF) was established at Bretton Woods in 1944 as an interim source of external finance for member countries with exceptional balance of payments needs. The first of the IMF’s Articles of Agreement outlines the Fund’s purposes, which include: (v) To give confidence to members by making the general resources of the Fund temporarily available to them under adequate safeguards, thus providing them with opportunity to correct maladjustments in their balance of payments without resorting to measures destructive of national or international prosperity. (vi) In accordance with the above, to shorten the duration and lessen the degree of disequilibrium in the international balances of payments of members. The Fund, therefore, was designed to provide financial support while the necessary changes in economic policy were implemented. Over time, a balance of payments deficit would be eliminated, or at least become sustainable, and the IMF’s assistance would no longer be needed. In these circumstances borrowing from the IMF would be a low frequency event, and the Fund’s resources would revolve as envisaged in the Articles. In reality, member countries can be divided into three groups: non-users, infrequent users and frequent or multiple users. The non-users either avoid balance of payments deficits or finance them through private borrowing. The infrequent users also usually avert deficits or have access to private capital markets because of their strong creditworthiness. However, occasionally they face balance of payments crises and during these periods they are forced to turn to the IMF because their riskiness as perceived in the private markets increases. For these countries, the IMF is a lender of last resort, to be used only when other sources of external finance are unavailable. Once the crisis passes and adjustment is carried out, their access to the private international capital markets is restored, which makes any future balance of payments deficit sustainable. In contrast to these two groups are those countries which are frequent or multiple users of IMF credit. These economies have recurring balance of payments problems but little access to capital markets, and turn to the Fund on a regular basis. In such cases there are elements of “recidivism” in the use of Fund resources. Recidivism in this context raises complex issues. Recidivism usually carries connotations of habitual relapse, as into crime. But is it the case that IMF recidivists are countries that persistently mismanage their resources? Or do other factors, such as external shocks or structural characteristics, distinguish these countries? What does recidivism imply about conditionality and program design? While a number of studies have observed the phenomenon of multiple use of Fund credit, none has examined IMF recidivism in any detail. This paper sets out to fill this gap by utilizing models with count data to identify the characteristics of those countries that make repeated use of Fund resources. The next section presents an analytical framework of the factors that may affect the rate of recidivism. The evidence of recidivism is presented in Section 3, and the methodology utilized in the empirical analysis is explained in Section 4. The empirical results are presented in Section 5. Section 6 offers some conclusions and implications.

The empirical results in this paper help to define the characteristics of countries that use IMF resources on a persistent basis. Countries that borrow tend to have recurring large current account deficits and lower reserve holdings, and consequently possess a need for external financing. The borrowers have larger capital outflows, which heighten their dependence on official external credit. This study finds strong evidence that external factors play a role in the decision to borrow. An increase in borrowing from the Fund is linked to weak but less volatile terms of trade and high debt-service and external debt ratios. The choice of exchange rate regime does not by itself raise the frequency of borrowing. Since some of these factors are outside the control of the borrowing countries, their ability to respond to external shocks is limited. There is also some indication that structural and institutional factors influence the incidence of borrowing. Borrowing from the IMF is inversely related to the level of income when the concessional facilities are included in the measurement of recidivism. Domestic investment spending is lower in the borrowing countries, consistent with the result on income per-capita. In one specification we found evidence that weak governance may affect a country’s ability to comply with Fund programs. What are the implications of these results? It is consistent with the IMF’s purpose to provide financial assistance to countries that face fundamental balance of payments problems and have few, if any, alternative sources of external finance. Moreover, the fact that borrowers appear to exhibit signs of structural weakness may be seen as supporting the Fund’s increasing efforts to address structural adjustment in program countries. However, the evidence also suggests that these problems are not easily overcome. Reducing the incidence of borrowing depends on enabling countries to avoid the conditions we have reported that lead to recurring deficits, and a crucial policy issue is how this goal can best be achieved. Some have suggested that the IMF should emphasize economic growth and poverty reduction with redesigned conditionality. Others believe that the Fund has been attempting to address issues with which it is not equipped to deal, and that the Fund should withdraw from much of its lending to poor countries. These issues constitute an important component of the contemporary debate about the future of the Fund and the goals of its programs.