The sustainable development consequences of IMF debt vs. capital control: comparing progress in GPI and GDP terms for Korea and Malaysia
The panic wrought by the 1997 Asian financial crisis spurred different mitigative measures. Some states assented to IMF bailout and restructuring, while others enforced capital control. Since then, despite intense academic and regulatory scrutiny of the nuances of the recession, empiric focus on rec...
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| Format: | Article |
| Language: | English English English |
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Elsevier Ltd
2019
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| Online Access: | http://irep.iium.edu.my/73404/ http://irep.iium.edu.my/73404/1/73404_The%20sustainable%20development%20consequences%20of%20IMF.pdf http://irep.iium.edu.my/73404/2/73404_The%20sustainable%20development%20consequences%20of%20IMF_SCOPUS.pdf http://irep.iium.edu.my/73404/13/73404_The%20sustainable%20development%20consequences%20of%20IMF%20debt_wos.pdf |
| _version_ | 1848787791512600576 |
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| author | Mohamad, Azhar Hashim, Mastura Sifat, Imtiaz Mohamma |
| author_facet | Mohamad, Azhar Hashim, Mastura Sifat, Imtiaz Mohamma |
| author_sort | Mohamad, Azhar |
| building | IIUM Repository |
| collection | Online Access |
| description | The panic wrought by the 1997 Asian financial crisis spurred different mitigative measures. Some states assented to IMF bailout and restructuring, while others enforced capital control. Since then, despite intense academic and regulatory scrutiny of the nuances of the recession, empiric focus on recovery trajectory of affected countries centred chiefly around traditional GDP metrics; an approach that disregards economic performance in a manner congruent with Sustainable Development Goals (SDG). In this paper, we adopt a broader SDG-compatible approach by tracking two affected countries’ (Korea and Malaysia) recovery via operationalizing an alternative growth indicator GPI (Genuine Progress Indicator). First, we construct a 35-year long GPI index from 1980 to 2014 and employ the Solow Growth Model to measure the impact of the two remedial measures on GDP and GPI of both countries. Employing an ARDL approach, we find external debt to impact significantly the GDP and GPI of Korea. Meanwhile for Malaysia, the controversial capital control failed to register significant impact. Moreover, unemployment rates, trade openness, fixed capital formation and the history of previous crises are found to be influential determinants of GDP and GPI, with credit and exchange rate variables showing ambiguous results. |
| first_indexed | 2025-11-14T17:30:33Z |
| format | Article |
| id | iium-73404 |
| institution | International Islamic University Malaysia |
| institution_category | Local University |
| language | English English English |
| last_indexed | 2025-11-14T17:30:33Z |
| publishDate | 2019 |
| publisher | Elsevier Ltd |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | iium-734042020-09-08T08:55:47Z http://irep.iium.edu.my/73404/ The sustainable development consequences of IMF debt vs. capital control: comparing progress in GPI and GDP terms for Korea and Malaysia Mohamad, Azhar Hashim, Mastura Sifat, Imtiaz Mohamma HB846 Welfare theory The panic wrought by the 1997 Asian financial crisis spurred different mitigative measures. Some states assented to IMF bailout and restructuring, while others enforced capital control. Since then, despite intense academic and regulatory scrutiny of the nuances of the recession, empiric focus on recovery trajectory of affected countries centred chiefly around traditional GDP metrics; an approach that disregards economic performance in a manner congruent with Sustainable Development Goals (SDG). In this paper, we adopt a broader SDG-compatible approach by tracking two affected countries’ (Korea and Malaysia) recovery via operationalizing an alternative growth indicator GPI (Genuine Progress Indicator). First, we construct a 35-year long GPI index from 1980 to 2014 and employ the Solow Growth Model to measure the impact of the two remedial measures on GDP and GPI of both countries. Employing an ARDL approach, we find external debt to impact significantly the GDP and GPI of Korea. Meanwhile for Malaysia, the controversial capital control failed to register significant impact. Moreover, unemployment rates, trade openness, fixed capital formation and the history of previous crises are found to be influential determinants of GDP and GPI, with credit and exchange rate variables showing ambiguous results. Elsevier Ltd 2019-10-10 Article PeerReviewed application/pdf en http://irep.iium.edu.my/73404/1/73404_The%20sustainable%20development%20consequences%20of%20IMF.pdf application/pdf en http://irep.iium.edu.my/73404/2/73404_The%20sustainable%20development%20consequences%20of%20IMF_SCOPUS.pdf application/pdf en http://irep.iium.edu.my/73404/13/73404_The%20sustainable%20development%20consequences%20of%20IMF%20debt_wos.pdf Mohamad, Azhar and Hashim, Mastura and Sifat, Imtiaz Mohamma (2019) The sustainable development consequences of IMF debt vs. capital control: comparing progress in GPI and GDP terms for Korea and Malaysia. Journal of Cleaner Production, 234 (1). pp. 725-742. ISSN 0959-6526 https://www.sciencedirect.com/science/article/pii/S0959652619320980 10.1016/j.jclepro.2019.06.144 |
| spellingShingle | HB846 Welfare theory Mohamad, Azhar Hashim, Mastura Sifat, Imtiaz Mohamma The sustainable development consequences of IMF debt vs. capital control: comparing progress in GPI and GDP terms for Korea and Malaysia |
| title | The sustainable development consequences of IMF debt vs. capital control: comparing progress in GPI and GDP terms for Korea and Malaysia |
| title_full | The sustainable development consequences of IMF debt vs. capital control: comparing progress in GPI and GDP terms for Korea and Malaysia |
| title_fullStr | The sustainable development consequences of IMF debt vs. capital control: comparing progress in GPI and GDP terms for Korea and Malaysia |
| title_full_unstemmed | The sustainable development consequences of IMF debt vs. capital control: comparing progress in GPI and GDP terms for Korea and Malaysia |
| title_short | The sustainable development consequences of IMF debt vs. capital control: comparing progress in GPI and GDP terms for Korea and Malaysia |
| title_sort | sustainable development consequences of imf debt vs. capital control: comparing progress in gpi and gdp terms for korea and malaysia |
| topic | HB846 Welfare theory |
| url | http://irep.iium.edu.my/73404/ http://irep.iium.edu.my/73404/ http://irep.iium.edu.my/73404/ http://irep.iium.edu.my/73404/1/73404_The%20sustainable%20development%20consequences%20of%20IMF.pdf http://irep.iium.edu.my/73404/2/73404_The%20sustainable%20development%20consequences%20of%20IMF_SCOPUS.pdf http://irep.iium.edu.my/73404/13/73404_The%20sustainable%20development%20consequences%20of%20IMF%20debt_wos.pdf |