Economic Liberalization Via IMF Structural Adjustment: Sowing War or Reaping Peace? – A Comment

Review of International Organization, 9(1), 2014

28 Pages Posted: 9 Jan 2017

See all articles by Trude Mariane Midtgard

Trude Mariane Midtgard

Norwegian University of Science and Technology (NTNU)

Krishna Chaitanya Vadlamannati

University College Dublin (UCD) - Department of Politics

Indra De Soysa

Norwegian University of Science and Technology

Date Written: January 5, 2017

Abstract

The global economic downturn has heightened concerns about intervention by global financial institutions and the maintenance of political stability. At least one, prominently-published article purports to show that signing on to an IMF structural adjustment program (SAP) increases the risk of civil war (Hartzell et al. 2010). The authors claim that IMF SAPs push liberalization, which hurt some people badly enough that they foment civil war. We advance the debate by critically examining their theoretical and empirical evidence, particularly questioning their crucial assumptions about the impact of IMF programs on the economic environment in terms of who actually wins and loses from liberalization and who might be in a position to rebel. With only minor adjustments to their own data, we find just the opposite of what they conclude. We show that their own measure of signing on to an IMF program turns negative and statistically significant if one uses a lower threshold of 25 deaths when defining civil war. These results suggest that their operationalization of the IMF variable as well as the use of large-scale civil war (1000 deaths and above) simply captures the effect of on going conflict rather than the effects of liberalization. After extending the time period under study and making only minor changes to operationalization, we find that at no time does IMF involvement successfully predict civil war onset.

Keywords: IMF, Crisis, Civil war, Replication

Suggested Citation

Midtgard, Trude Mariane and Vadlamannati, Krishna Chaitanya and De Soysa, Indra, Economic Liberalization Via IMF Structural Adjustment: Sowing War or Reaping Peace? – A Comment (January 5, 2017). Review of International Organization, 9(1), 2014. Available at SSRN: https://ssrn.com/abstract=2894462

Trude Mariane Midtgard

Norwegian University of Science and Technology (NTNU) ( email )

Høgskoleringen
Trondheim NO-7491, 7491
Norway

Krishna Chaitanya Vadlamannati (Contact Author)

University College Dublin (UCD) - Department of Politics ( email )

Belfield
Dublin 4
Ireland

Indra De Soysa

Norwegian University of Science and Technology ( email )

Høgskoleringen
Trondheim NO-7491, 7491
Norway

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