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The international monetary fund and economic policy


Few countries have complete autonomy in macroeconomic policy. For many, policy is conducted in collaboration with the International Monetary Fund (IMF) or supervised by the IMF.

The module examines the changing roles of the IMF, the nature of economic policies it encourages countries to pursue, and some of the effects these policies have on the economic environment of business, on the financial sector, and on social conditions.

The module gives a simple introduction to the basic IMF economic policy framework, 'financial programming'. Using different types of countries, including transition economies and developing countries as case studies, it enables you to study issues such as the role of capital controls and the problems of highly indebted countries.

Topics covered

  • Unit 1: Macroeconomic Stabilisation and the Role of the IMF
  • Unit 2: The IMF's Approach to Stabilisation
  • Unit 3: Alternative Approaches to Stabilisation
  • Unit 4: Stabilisation and the Financial Sector
  • Unit 5: Stabilisation Policy and Financial Sector – Institutional Responses to Recent Crises
  • Unit 6: Stabilisation and the Financial Sector – Some Challenges and Controversies
  • Unit 7: Stabilisation and Low-Income Countries
  • Unit 8: Challenges for Low-Income Countries


  • one three-hour unseen written examination (70%)
  • two tutor marked assignments (30%)

Essential reading

  • IMF (2015) Ghana: Request For A Three-Year Arrangement Under The Extended Credit Facility; Staff Report; Press Release; and Statement by the Executive Director for Ghana, Country Report No. 15/103
  • IMF (2014) South Africa: Financial System Stability Assessment, Country Report No. 14/340