Essays on institutional quality, macroeconomic stabilization, and economic growth in International Monetary Fund member countries

Author

Javed, Omer

Director

Nonell, Rosa

Tutor

Nonell, Rosa

Date of defense

2015-09-10

Legal Deposit

B 27957-2015

Pages

128 p.



Department/Institute

Universitat de Barcelona. Departament de Política Econòmica i Estructura Econòmica Mundial

Abstract

This study is motivated by the overall poor performance of International Monetary Fund (IMF) programs in recipient countries in terms of economic growth consequences, and tries to explore the relevance of institutional determinants for economic growth in these program countries. The analysis, at the same time, also takes into consideration the claim by New Institutional Economics (NIE) literature, which points out an overall positive consequence of institutional quality determinants on economic growth for countries in general. Taking a panel data of IMF member countries, the thesis primarily focuses on the IMF program countries, during 1980-2009; a time period during which the number of IMF programs witnessed an increasing trend. Firstly, important determinants of economic- and political institutional quality in IMF program countries are estimated by applying the System- GMM approach, so as to find significant determinants among them. Here, a parliamentary form of government, aggregate governance level, civil liberties, openness, and property rights all enhance overall institutional quality. Specifically, greater monetary- and investment freedom are conducive for political institutional quality, while military in power impacts negatively. Moreover, economic growth is conducive for enhancing economic institutional quality. Thereafter, the impact of the significant institutional determinants is then estimated on real economic growth, both directly, and also indirectly, through the channel of macroeconomic stability. Results mainly validate that institutional determinants overall play a positive role in reducing macroeconomic instability, and through it, and also independently, enhance real economic growth. In the last part of the thesis, Pakistan is selected as a representative example of a frequent user of IMF resources. Here, by applying the Vector Autoregression (VAR) model techniques, various counterfactual scenarios are estimated for a period of 1980-2014, to see impact of an institutional determinant, KOF index of globalization on macroeconomic instability and real economic growth. Results highlight that through enhanced focus on institutional reduced, and hence higher growth rate of GDP can be achieved.

Keywords

Organismes internacionals; Organismos internacionales; International agencies; Macroeconomia; Macroeconomía; Macroeconomics; Creixement econòmic; Crecimiento económico; Economic growth

Subjects

338 - Economic situation. Economic policy. Management of the economy. Economic planning. Production. Services. Prices

Knowledge Area

Ciències Jurídiques, Econòmiques i Socials

Documents

OMER_JAVED_PhD_THESIS.pdf

1.755Mb

 

Rights

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