The Politics of Hard Choices: IMF Programs and Government Spending

• Published in: International organization Vol. 60; no. 4; pp. 1001 - 1033
• Main Authors: Nooruddin, Irfan, Simmons, Joel W.
• Format: Journal Article
• Language: English
• Published: New York, USA Cambridge University Press 01-10-2006
• Subjects: 21st century; Associations; Austerity; Budget deficits; Budgets; Democracy; Domestic Politics; Drafts; Education; Errors; Federal budget deficit; Government; Government budgets; Government services; Government Spending; Gross domestic product; Health care economics; IMF; International financial institutions; International studies; Loans; Macroeconomics; Meetings; Political science; Politics; Poor; Poverty alleviation; Public Debt; Public expenditure; Public Services; Social policy; Social protection
• ISSN: 0020-8183; 1531-5088
• DOI: 10.1017/S0020818306060334

A central component of International Monetary Fund (IMF) programs is reducing government budget deficits. We ask how domestic political considerations shape the distribution of cuts made by governments in IMF programs. Our central finding is that IMF programs shrink the role played by domestic politics. While democracies allocate larger shares of their budgets to public services in the absence of IMF programs, the difference between democracies and nondemocracies disappears under IMF programs. This result has important implications for our understanding of government spending priorities under different resource constraints.