Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/97786
Authors: 
Binder, Michael
Bluhm, Marcel
Year of Publication: 
2014
Series/Report no.: 
IMFS Working Paper Series 78
Abstract: 
The empirical evidence currently available in the literature regarding the effects of a country's IMF program participation on its output growth is rather inconclusive. In this paper we propose and estimate a panel data sample selection model featuring state dependence. As in this model the output growth effects of program participation can be conditional on the realization of a state variable (conditional pooling), our framework may reconcile previous empirical evidence based on models without state-dependent effects. We find that the effects of IMF program participation on output growth vary systematically with an index reflecting a country's institutional record, and that output growth effects of program participation are significantly positive only if the program participation is coupled with sufficient improvement of the institutional record.
Subjects: 
Conditional Pooling
IMF Program Participation
Output Growth
Panel Sample Selection Models
JEL: 
O11
O19
C33
Document Type: 
Working Paper

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