An improvement in the quality of public expenditures is needed in many countries, given binding macroeconomic and fiscal constraints, and poverty reduction and distributional objectives. This process involves a reassessment of methodology used for this purpose by countries and international...

How is a developing country affected by its government's ability to borrow in international markets? We examine the dynamics of a country's growth, consumption, and sovereign debt, assuming that the government's objective is to maximize short-term, typically wasteful, expenditures. Sovereign...

This paper examines the link between foreign aid and the composition of government spending in aid-recipient countries. Two questions are addressed: (i) does foreign aid crowd out government spending in aid-recipient countries, and (ii) does the degree of fungibility vary across different...

This paper focuses on the debt build-up that frontier low-income developing countries (LIDCs) have faced since 2012. First, it documents a 20-percentage point increase in the external and government debt-to-GDP ratios, a composition shift toward higher non-concessional debt, and a rise in...

In this work, behavior of money multipliers for a developing country, Turkey is examined and is calculated by estimating the values of the model constructed for the purpose for the period of 1952-1972. However, model lends itself for applications covering any other period.Study includes three...

This paper develops new error assessment methods to evaluate the performance of debt sustainability analyses (DSAs) for low-income countries (LICs) from 2005-2015. We find some evidence of a bias towards optimism for public and external debt projections, which was most appreciable for LICs with...

This paper uses a two-sector open economy model to examine the dynamic absorption of foreign aid in the presence of both formal and informal production. Calibrating the model to yield a long-run equilibrium consistent with sample averages for 72 aid-recipient developing countries for the period...

This paper examines fungibility as a possible explanation for the missing link between foreign aid and economic growth. The composition of aid plays a crucial role in determining the composition of government spending and, consequently, the magnitude of fungibility and its impact on growth....

This paper focuses on several topics related to macroeconomic policies in LDC's. The selection is biased towards those cases I have dealt with during my last 20 years of professional experience, home based in Argentina. Inflation, dollarization, quasi-fiscal deficits, capital controls and...

Debt relief is unlikely to stimulate investment and growth in the world's highly indebted poor countries (HIPCs). This is because the HIPCs do not suffer from debt overhang. The principal obstacle to investment and growth in the world's poorest countries is a lack of basic economic institutions...