Compliance, defiance, and the dependency trap: International Monetary Fund program interruptions and their impact on capital markets
نویسندگان
چکیده
The International Monetary Fund (IMF) is infamous for its structural adjustment programs, requiring countries to undertake policy reforms in exchange loans. Yet, not only do routinely fail implement these reforms, but they also frequently return the IMF start process anew. What explains this compelling case of transnational regulatory ineffectiveness? We argue that are caught a dependency trap: politically contentious prescriptions drive non-compliance, triggering adverse market reactions leave with few sources financing beyond IMF, leading their eventual doors organization fresh loan. Using new data on 763 programs from 1980 2015, we initially demonstrate prevalence market-liberalizing increases likelihood program interruptions. then show interruptions undermine investor confidence and increase sovereign borrowing costs. Our study uncovers hitherto neglected relationships between international institutions capitalism, country compliance, financial responses.
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ژورنال
عنوان ژورنال: Regulation & Governance
سال: 2021
ISSN: ['1748-5991', '1748-5983']
DOI: https://doi.org/10.1111/rego.12422