The Macroeconomic Effects of ESAF-Supported Programs: Revisiting Some Methodological Issues

BySusan M Schadler, Louis Dicks-Mireaux, Mauro Mecagni

September 1, 1995

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper examines whether ESAF-supported programs during 1986-91 had significant independent effects on growth, inflation and the external debt service ratio. Econometric estimates of the Generalized Evaluation Estimator (GEE) identify statistically significant beneficial effects on output growth and the debt service ratio but no effects on inflation. The robustness of these estimates is also examined. Diagnostic tests cast doubt on the applicability of the GEE framework to the ESAF-eligible countries, and the results obtained using it.

Subject: Debt service ratios, External debt, Fiscal policy, Fiscal stance, Foreign exchange, Inflation, Nominal effective exchange rate, Prices

Keywords: Caribbean, debt service, Debt service ratios, dummy variable, estimation result, Fiscal stance, Fund support, Fund-supported program, growth rate, Inflation, least squares, Nominal effective exchange rate, Pacific Islands, policy instrument, policy reaction function, Policy variable, regression estimate, sample estimate, South Asia, Southeast Asia, WP

Pages:
42
Volume:
1995
DOI:
https://doi.org/10.5089/9781451951486.001
Issue:
092
Series:
Working Paper No. 1995/092
Stock No:
WPIEA0921995
ISBN:
9781451951486
ISSN:
1018-5941

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