Keeping Capital Flowing: The Role of the IMF

35 Pages Posted: 9 Feb 2006

See all articles by Michael D. Bordo

Michael D. Bordo

Rutgers University, New Brunswick - Department of Economics; National Bureau of Economic Research (NBER)

Ashoka Mody

International Monetary Fund (IMF) - Research Department

Nienke Oomes

International Monetary Fund (IMF)

Multiple version iconThere are 2 versions of this paper

Date Written: October 2004

Abstract

In this paper, we examine the IMF`s role in maintaining the access of emerging market economies to international capital markets. We find evidence that both macroeconomic aggregates and capital flows improve following the adoption of an IMF-supported program, although they may initially deteriorate somewhat. Consistent with theoretical predictions and earlier empirical findings, we find that IMF-supported programs are most successful in improving capital flows to countries with bad, but not very bad fundamentals. In such countries, IMF-supported programs are also associated with improvements in the fundamentals themselves.

Keywords: International Monetary Fund, capital flows, catalytic finance, emerging markets

JEL Classification: F21, F33

Suggested Citation

Bordo, Michael D. and Mody, Ashoka and Oomes, Nienke, Keeping Capital Flowing: The Role of the IMF (October 2004). IMF Working Paper No. 04/197. Available at SSRN: https://ssrn.com/abstract=879022

Michael D. Bordo (Contact Author)

Rutgers University, New Brunswick - Department of Economics ( email )

New Brunswick, NJ
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Ashoka Mody

International Monetary Fund (IMF) - Research Department ( email )

700 19th Street NW
Washington, DC 20431
United States
202-623-9617 (Phone)
202-589-9617 (Fax)

HOME PAGE: http://www.amody.com

Nienke Oomes

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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