The Catalytic Role of IMF Programs

40 Pages Posted: 25 May 2021

Date Written: April 20, 2021

Abstract

This paper investigates the impact of IMF programs on private capital flows in the assisted countries. We look at the impact on inflows and outflows of both traditional and precautionary programs, also taking into account the characteristics of the programs. Using the entropy balancing method to address the selection bias, we find that traditional IMF programs have an anticatalytic effect on private capital inflows; this effect is mainly driven by programs that went off-track and by exceptional access programs. By contrast, precautionary programs are found to have a catalytic effect, working mainly through outflows.

Keywords: International Monetary Fund, catalysis, capital flows

JEL Classification: F33, F34, G11, G15

Suggested Citation

Maurini, Claudia and Schiavone, Alessandro, The Catalytic Role of IMF Programs (April 20, 2021). Bank of Italy Temi di Discussione (Working Paper) No. 1331, Available at SSRN: https://ssrn.com/abstract=3852797 or http://dx.doi.org/10.2139/ssrn.3852797

Claudia Maurini (Contact Author)

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy

Alessandro Schiavone

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy

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