IDEAS home Printed from https://ideas.repec.org/p/imf/imfwpa/1988-108.html
   My bibliography  Save this paper

The Stabilizing Role of the Compensatory Financing Facility: Empirical Evidence and Welfare Implications

Author

Listed:
  • International Monetary Fund

Abstract

Purchases under the compensatory financing facility, the IMF’s largest special facility, accounted for more than one quarter of total credit extended by the IMF over the period 1976 to 1985. Given the size of these operations, it is of some interest to determine to what extent the facility served its intended purpose—the stabilization of foreign exchange earnings of member countries experiencing temporary export shortfalls. This paper develops a methodology for evaluating the CFF’s stabilizing role and provides some quantitative evidence of its effectiveness. This evidence is then used to obtain an indication of the facility’s role in stabilizing the demand for international reserves and its contribution to net welfare gain. The results suggest that the facility has been important in stabilizing members’ earnings, and that the net benefits derived by them can be regarded as substantial.

Suggested Citation

  • International Monetary Fund, 1988. "The Stabilizing Role of the Compensatory Financing Facility: Empirical Evidence and Welfare Implications," IMF Working Papers 1988/108, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:1988/108
    as

    Download full text from publisher

    File URL: http://www.imf.org/external/pubs/cat/longres.aspx?sk=27901
    Download Restriction: no
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:imf:imfwpa:1988/108. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Akshay Modi (email available below). General contact details of provider: https://edirc.repec.org/data/imfffus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.