The politics of adjustment: lessons from the IMF's Extended Fund Facility

The international debt crisis has forced painful economic adjustments on the developing world. In the short run it has forced governments to seek to correct payments imbalances through stabilization programs, usually undertaken with conditional assistance from the International Monetary Fund (IMF). The crisis has also revealed deeper weaknesses in many Third World economies, weaknesses demanding more basic reforms in the structure of incentives, prices, and investment.