This paper is about financial flows in developing countries. It reviews the evidence on who the borrowers and lenders are. Apart from collecting and summarizing available data from some seventeen countries, the paper presents the results of an econometric analysis of the interactions between the...

There is much debate in both developed and developing countries about what kinds of financial institutions and markets best serve economic growth. To what extent can the superior performance of Japanese and German economies be attributed to their market-based system (with a focus on short-term...

The present paper is the product of an effort to systematize some of the state owned enterprise (SOE) data that have become available recently. Part one of the paper begins by examining the role of SOEs on aggregate value added and investment, during the 1980-85 period in developing countries....

Voluntary debt reduction schemes (VDR), such as debt-equity swaps (DES) or collateralized debt conversions (CDC), are bound to play a relevant role in the foreign debt strategy of highly indebted countries (HICs). This paper assesses the impact of VDR on domestic macroeconomic variables. More...

Conventional development economics has focused mainly on generating economic growth by mobilizing savings and allocating them wisely among investment opportunities. Savings (external and domestic) were to be mobilized through tax incentives, income, and interest rate policies. Their allocation...

This paper tries to uncover the reasons underlying the performance of the Moroccan economy. The author argues that wage moderation and judicious monetary policies were instrumental in restraining inflation. With one brief exception in 1983, monetary authorities remained firmly committed to...

Economic policy reform that creates opportunities for new productive activities often shifts wealth from one set of agents toward another, creating reason for political pressure against the reform. The author explores how government financial guarantees secure the political support of the...

The literature on safety nets has become technically more precise by drawing on advances in contract theory and optimal governance structure. This paper begins with a treatment of some aspects of the theory. The author's approach draws more on institutional economics, and more precisely on the...

Banking sectors in transition economies have experienced major transformations throughout the 1990s. While some countries have been successful in eliminating underlying distortions and restructuring their financial sectors, in some cases financial sectors remain underdeveloped and the rates of...

The authors examine why emerging markets, in particular, are susceptible to and affected by financial difficulties. They show that these difficulties have a richer, more complex structure than they are sometimes believed to have - with marked information asymmetries and substantial volatility....