Economic stabilization, conditionality, and political stability

Bibliographic Data

ID6272016
AuthorsHenry S Bienen (Princeton University), Mark Gersovitz (0000-0002-4765-1690, Princeton University)
Year1985
Volume39
Issue4
Pages729-754
Publication date1985-01-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueInternational Organization (JOURNAL)
Journal identifiersISSN: 0020-8183 • E-ISSN: 1531-5088
PublisherCambridge University Press (CUP) (PUBLISHER)
DOI10.1017/s0020818300027089
OpenAlexW1967969240
LanguageEN
Citations received35
References cited19

IMF conditionality is seldom so important that it dominates all other considerations for political stability. IMF stabilization programs often shift benefits from one group to another. They expose elites to charges of selling the sovereignty of their countries. The imposition of IMF conditions, particularly subsidy cuts, may lead to sharp outbreaks of civil disorder. Nonetheless, the IMF provides resources that make adjustment easier and thus may lessen the chances of political instability for a country. IMF programs are seldom implemented fully as negotiated, and the penalties for partial compliance are not great. Debtor countries have more flexibility in imposing austerity measures, and the economic constraints are less binding than often assumed. The very availability of alternatives to IMF programs results in internal divisions because some favor debt repudiation and others oppose it. Groups now contend over solutions to the debt problems of their countries

Austerity · Conditionality · Creditor · Debt · Debtor · Economic policy · Economic system · Economics · Flexibility (engineering · International economics · Market economy · Political economy · Political science · Politics · Subsidy · Finance · Fiscal Policy and Economic Growth · Law · Local Government Finance and Decentralization · Taxation and Compliance Studies