From the very start structural adjustment programs and the IMF’s involvement in them have been criticized on the speculation that they would hurt the poor, mainly through reductions in public expenditures on health, education and other social services from which the poor benefited. This was supported by evidence that social indicators (such as malnutrition and child mortality) worsened in some countries after the adoption of an adjustment program. Since many of the adjustment programs arose in circumstances of unsustainable external deficits, and so commenced with a stabilization phase, the counterfactual was likely to involve declining real expenditure.
Subsequently a more serious literature has developed on the effects of structural adjustment programs which tend to refute these speculations, although there remain serious methodological problems. Comparisons of adjusting and non-adjusting countries usually fail to control sufficiently for other differences between the two groups. Cross-country regressions can be used to assess the impact of adjustment programs on macro-economic variables, but they are unsuitable for analyzing their distributional impact since there are insufficient data on distributional change: household incomes are measured infrequently. An additional problem in the econometric work is that when a large number of policy changes are adopted simultaneously it becomes difficult to distinguish the effects of policy changes agreed in Fund programs from other measures.
The best-known brand of development economics that arose in the 1950s is called the structuralist school. Unlike neoclassical economists, who assumed a smoothly working market-price system, some of the early development economists adopted a more structuralist approach to development problems where they adopted a more pessimistic view about the ability of the free market to eradicate poverty.
The diversity of perspectives underlying the early development of the international regime concept casts doubt on the popular account that the concept is somehow necessarily embedded within neorealism and....
