Does the global fireman inadvertently add fuel to the fire? New evidence from institutional investors' response to IMF program announcements

Shang-Jin Wei, Zhiwei Zhang, Qingyuan Du

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8 Citations (Scopus)


Fighting global financial crises is a primary charge of the IMF. Yet it has often been criticized to have hindered rather than helped the recovery of many countries in a crisis by demanding policy changes that may not be appropriate for them in that particular moment. Such actions would tend to damage investor confidence. Using monthly data on investment in 94 developing countries by 168 institutional investors during 1996-2005, this paper re-assesses this important question. We find that the IMF has typically restored rather than reduced investor confidence.
Original languageEnglish
Pages (from-to)728 - 741
Number of pages14
JournalJournal of International Money and Finance
Issue number4
Publication statusPublished - 2010
Externally publishedYes

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