Evaluate the Effect of IMF’s Longer-Term Concessional Lending Programs on Growth in the Development Background of Sub-Saharan Region

Authors

Guanyi Yang, Ohio Wesleyan UniversityFollow

Abstract

Despite different voices from critics, the IMF has put development at the center of its policies. This paper tries to separate the effect of SAF, ESAF, PRGF, and ECF on growth empirically. Selecting a sample of 44 countries in the Sub-Saharan region from 1986 to 2011, it analyzes whether the IMF’s longer-term structural adjustment programs influences economic growth in participating countries. Consistent with previous studies, this research shows that SAF and ESAF have statistically insignificant impact on growth in the short term and long term. PRGF and ECF, on the other hand, are found to have a large and strong positive correlation with growth rate in the short run, and immaterial impact in the long run. Results also show that the structural adjustment programs not only offer impact through loan disbursement, but more through the catalytic effect that goes along with the loan. The overall result provides evidence that the “streamlining” revolution of the IMF in providing structural adjustment advice has shown optimistic effect in Sub-Saharan Africa economic growth.

Recommended Citation

Yang, Guanyi (2013) "Evaluate the Effect of IMF’s Longer-Term Concessional Lending Programs on Growth in the Development Background of Sub-Saharan Region," Undergraduate Economic Review: Vol. 10: Iss. 1, Article 2.
Available at: https://digitalcommons.iwu.edu/uer/vol10/iss1/2