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We analyze how the altruism of an international financial institution (IFI) towards its lowincome member countries (LICs) alters the effectiveness of its loans. We study IFI loans to a credit-constrained LIC. The IFI's repayment policy is determined by the interplay of its concerns for the welfare of the loan recipient and its fiduciary responsibilities to creditor countries. If the IFI is unable to commit to repayment terms in advance, conditional loans are superior to unconditional loans. Thus, IFI altruism and the inability to commit are sufficient reasons to equip loans with conditions. Conditional loans produce an efficient allocation of resources, so altruism is not a fundamental reason that loans fail to increase welfare.

Loans, Foreign. --- Conditionality (International relations) --- Political conditionality --- International relations --- Economic assistance --- Loans, Foreign --- Foreign loans --- International loans --- Loans, International --- Loans --- Foreign loan insurance --- International Monetary Fund. --- Internationaal monetair fonds --- International monetary fund --- Exports and Imports --- Investments: General --- Labor --- Macroeconomics --- Industries: Financial Services --- Banks --- Depository Institutions --- Micro Finance Institutions --- Mortgages --- Macroeconomics: Consumption --- Saving --- Wealth --- Human Capital --- Skills --- Occupational Choice --- Labor Productivity --- International Lending and Debt Problems --- Investment --- Capital --- Intangible Capital --- Capacity --- Finance --- Labour --- income economics --- International economics --- Consumption --- Human capital --- Debt service schedules --- Return on investment --- Economics --- Debt service --- Saving and investment

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Large stocks of U.S. dollars and other hard currencies circulate in the transition economies, in Latin America, and in other countries that have experienced macroeconomic mismanagement. Using a monetary model that combines the legal restrictions and crime-theoretic traditions, this paper demonstrates how leaky exchange controls lead to currency substitution and progressive dollarization. The paper also analyzes the impact of dollarization on the ability of governments to earn seigniorage, the dynamics of dollarization in a growing economy, and the central role of expectations—specifically, confidence in the domestic currency—in determining the extent of dollarization and, potentially, in reversing it.

Finance: General --- Investments: Stocks --- Money and Monetary Policy --- Public Finance --- Demand for Money --- Monetary Systems --- Standards --- Regimes --- Government and the Monetary System --- Payment Systems --- Foreign Exchange --- Open Economy Macroeconomics --- Trade Policy --- International Trade Organizations --- Pension Funds --- Non-bank Financial Institutions --- Financial Instruments --- Institutional Investors --- International Financial Markets --- Monetary economics --- Public finance & taxation --- Investment & securities --- Finance --- Currencies --- Dollarization --- Anti-smuggling --- Stocks --- Currency markets --- Money --- Monetary policy --- Revenue administration --- Financial institutions --- Financial markets --- Smuggling --- Foreign exchange market --- United States

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Improving the effectiveness of financial assistance programs is a priority of international financial institutions (IFIs). This paper examines the effectiveness of alternative assistance instruments in a dynamic political economy framework. Economic policies of the receiving country are distorted by the influence of a domestic interest group. The assistance-providing IFI aims at reducing these distortions. The IFI provides assistance either as grants or loans, and either conditionally on reducing policy distortions or unconditionally. The paper shows that, other things constant, one-time grants are more effective than loan rollovers when assistance is unconditional, but that the opposite is true when assistance is conditional.

Loans, Foreign. --- Economic assistance. --- Conditionality (International relations) --- Political conditionality --- International relations --- Economic assistance --- Loans, Foreign --- Economic aid --- Foreign aid program --- Foreign assistance --- Grants-in-aid, International --- International economic assistance --- International grants-in-aid --- Economic policy --- International economic relations --- Foreign loans --- International loans --- Loans, International --- Loans --- Foreign loan insurance --- Macroeconomics --- Industries: Financial Services --- Policy Objectives --- Policy Designs and Consistency --- Policy Coordination --- International Monetary Arrangements and Institutions --- International Lending and Debt Problems --- Banks --- Depository Institutions --- Micro Finance Institutions --- Mortgages --- Measurement and Data on National Income and Product Accounts and Wealth --- Environmental Accounts --- Financial Institutions and Services: General --- Finance --- National income --- Multilateral development institutions --- Financial institutions --- National accounts --- Development banks --- United States

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We present estimates of welfare by country for 2007 and 2014 using the methodology of Jones and Klenow (2016) which incorporates consumption, leisure, mortality and inequality, and we extend the methodology to include environmental externalities. During the period of the global financial crisis welfare grew slightly more rapidly than income per capita, mainly due to improvements in life expectancy. This led to welfare convergence in most regions towards advanced country levels. Introducing environmental effects changes the welfare ranking for countries that rely heavily on natural resources, highlighting the importance of the natural resource base in welfare. This methodology could provide a theoretically consistent and tractable way of monitoring progress in several Sustainable Development Goal (SDG) indicators.

Macroeconomics --- Environmental Conservation and Protection --- Equity, Justice, Inequality, and Other Normative Criteria and Measurement --- Macroeconomics: Consumption --- Saving --- Wealth --- Macroeconomics: Production --- Employment --- Unemployment --- Wages --- Intergenerational Income Distribution --- Aggregate Human Capital --- Aggregate Labor Productivity --- Health Behavior --- Comparative Studies of Countries --- Environment and Development --- Environment and Trade --- Sustainability --- Environmental Accounts and Accounting --- Environmental Equity --- Population Growth --- Aggregate Factor Income Distribution --- Health: General --- Climate --- Natural Disasters and Their Management --- Global Warming --- Health economics --- Climate change --- Income --- Consumption --- Health --- Greenhouse gas emissions --- Income inequality --- National accounts --- Environment --- Economics --- Greenhouse gases --- Income distribution --- United States

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The econometric literature has been unable to establish a robust association between foreign aid and growth and poverty reduction. In this paper we argue that aid effectiveness must be assessed using methods that go beyond cross-country regressions. We calibrate a dynamic general equilibrium model that is capable of generating large income gaps between rich and poor countries. The model quantifies three sources of poverty: (i) lack of access to international capital, (ii) low schooling and high fertility (a poverty trap), and (iii) antigrowth domestic fiscal policy. We analyze policies designed to address each source of poverty and estimate and compare the aid cost of implementing the different policies. The policies differ dramatically in the extent and timing of their growth effects, and in the aid cost of their implementation.

Economic assistance -- Econometric models. --- Economic development -- Econometric models. --- Electronic books. -- local. --- Poverty -- Econometric models. --- Business & Economics --- Economic History --- Economic assistance --- Economic development --- Poverty --- Econometric models. --- Destitution --- Economic aid --- Foreign aid program --- Foreign assistance --- Grants-in-aid, International --- International economic assistance --- International grants-in-aid --- Wealth --- Basic needs --- Begging --- Poor --- Subsistence economy --- Economic policy --- International economic relations --- Conditionality (International relations) --- Labor --- Public Finance --- Production and Operations Management --- Poverty and Homelessness --- Policy Objectives --- Policy Designs and Consistency --- Policy Coordination --- International Monetary Arrangements and Institutions --- International Lending and Debt Problems --- Fiscal Policy --- Education: General --- Employment --- Unemployment --- Wages --- Intergenerational Income Distribution --- Aggregate Human Capital --- Aggregate Labor Productivity --- Macroeconomics: Production --- Wages, Compensation, and Labor Costs: General --- Welfare, Well-Being, and Poverty: General --- Macroeconomics --- Education --- Labour --- income economics --- Poverty & precarity --- Fiscal policy --- Capital productivity --- Productivity --- Production --- Industrial productivity --- United States