External Shocks and Fiscal Adjustment in Developing Countries: Experiences During 1962-82

30 Pages Posted: 15 Feb 2006

See all articles by Ke-young Chu

Ke-young Chu

International Monetary Fund (IMF) - Fiscal Affairs Department

Date Written: July 22, 1987

Abstract

This paper analyzes factors underlying fiscal developments in 18 developing countries during 1962-82 in relation to developments in their external sectors, which constitute one of their main revenue bases. The analysis focuses on how government expenditure was used as a policy instrument for fiscal adjustment in the face of external shocks and the consequent fiscal imbalances. The analysis indicates that fiscal policy responded to external shocks in a fairly large number of countries. In particular, fiscal policy responses to unexpected shocks were stronger than the responses to anticipated ones.

JEL Classification: 321

Suggested Citation

Chu, Ke-young, External Shocks and Fiscal Adjustment in Developing Countries: Experiences During 1962-82 (July 22, 1987). IMF Working Paper No. 87/48, Available at SSRN: https://ssrn.com/abstract=884804

Ke-young Chu (Contact Author)

International Monetary Fund (IMF) - Fiscal Affairs Department ( email )

700 19th Street, NW
Washington, DC 20431
United States

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