Is Transparency Good for You, and Can the IMF Help?

Yongseok Shin and Rachel Glennerster

No 2003/132, IMF Working Papers from International Monetary Fund

Abstract: This paper finds that reforms introduced by the IMF to promote transparency have created more informed markets and reduced borrowing costs for those emerging market countries that volunteered for them. Using a quarterly panel estimation with fixed country effects, we find that sovereign spreads fall following the adoption of three different transparency reforms. The effects are economically important, especially for those countries with low initial transparency. We use two-stage least squares to address any endogeneity in the timing of reforms exploiting internal IMF timetables that are unrelated to country events. Next, using a panel GARCH specification, we show that spreads move more than normal in the days immediately following publication of IMF country documents.

Keywords: WP; program country; least squares; Transparency; publication; institutions; emerging markets; sovereign spreads; IMF; SDDS; ROSC; Article IV; GARCH; news effect; role of the IMF; credit ratings; borrowing costs; capital markets; data dissemination; market information; Article IV report; IMF document; publication effect; IMF country document; Article IV publication; IMF report; Special Data Dissemination Standard (SDDS); Securities markets; Emerging and frontier financial markets; International capital markets; Africa; Central and Eastern Europe; Middle East; Western Hemisphere; Asia and Pacific (search for similar items in EconPapers)
Pages: 47
Date: 2003-06-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (24)

Downloads: (external link)
http://www.imf.org/external/pubs/cat/longres.aspx?sk=16492 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:2003/132

Ordering information: This working paper can be ordered from
http://www.imf.org/external/pubs/pubs/ord_info.htm

Access Statistics for this paper

More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC.
Bibliographic data for series maintained by Akshay Modi ().