IMF lending arrangements in emerging and developing countries – participation and prediction

AbstractThe literature on determinants of International Monetary Fund (IMF) interventions in emerging and developing countries shows that the IMF’s decisions are determined by political and economic causes. This article empirically investigates economic factors, showing that a country’s probability to sign an IMF arrangement can be predicted by looking at a core group of macroeconomic variables. Using discriminant analysis we develop a score function that allows us to predict a country’s future participation in IMF programmes. The study covers 153 emerging and developing countries, over more than 30 years (1980–2011) and 654 agreements, for both non-concessional and concessional loans. The …