The name is absent

Adoption of an IMF Programme and
Debt Rescheduling. An empirical
analysis

Silvia Marchesi^α
Department of Economics
University of Warwick

January 11, 2001

Abstract

The existence of an empirical relationship between the adoption of an
IMF programme and the concession of a debt rescheduling by commer-
cial creditors is tested using a bivariate probit model.  If countries who

have arrangements with the IMF are more likely than others to obtain a
reschedu ling of their external debt we could conclude that the adoption of
an IMF programme could work as a sort of signal of a country’s “good will-
ingness”, which is thus rewarded with the debt relief. The results con...rm
the existence of a signi...cant eɑeet of the adoption of an IMF programme
on the subsequent concession of a debt rescheduling by creditors.

JELclassi^cation: F34, C35

Keywords: IMF Conditionality, Debt Rescheduling, Bivariate probit.

^π I am grateful to Wiji Arulampalam and Lorenzo Cappellari for very helpful comments
throughout all this work. I would also like to thank Giovanni Ferri, Eric Le Borgn e, Gre-
gorio Impavido, Emanuela M arrocu, Marcus Miller, Luca Papi, Annamaria Pinna, Jonathan
P. Thomas, Ken Wallis, John Whalley and participants at 1999 ESEM and EEA con fer-

ences in Santiago de Compostela and at seminars in Ancona, London, Warwick and Pisa.

All errors and omissions remain my own.  F inancial help from the European Commission,

TM R M arie Curie Fellowship ERB4001 GT 973677, is gratefully acknowledged. Correspon-
dence: Department of Economics, University of Warwick, Coventry CV4 7AL, England. E-mail:
[email protected]

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