The Cost of a Better World: Are Borrower Countries’ Citizens Willing to Pay for Progressive IMF Programs?

The International Monetary Fund (IMF) has shifted gears to address climate change, gender equity, and socio-economic inequality in its day-to-day operations. These issues arguably go beyond its historical mandate: stabilize global financial markets and provide emergency loans to ailing economies. How does this policy scope expansion affect the support for the IMF and its loans among the populations of borrowing countries? On the one hand, adherents to neo-colonial views consider climate change, gender equality, and human rights as an attempt by industrialized countries to impose their preferences upon borrowing countries. On the other hand, and contrary to widely held beliefs, one could argue that borrower populations may welcome the inclusion of progressive policy issues in IMF adjustment programs. To adjudicate between these views, we conduct a survey experiment with N=2,500 respondents from three borrower countries—Argentina, Kenya, and Pakistan. Using a conjoint experiment, we present respondents with two IMF loans with randomly varying policy conditions, ranging from traditional austerity and structural reforms to more progressive conditions. We then ask respondents to indicate their support for either loan, the extent to which they would be willing to pay more taxes, and the degree to which respondents would accept cuts in public service provision under either loan agreement. Our findings contribute to the literature on the legitimacy of international organizations by going beyond diffuse support and focusing on specific policy packages. For the literature on IMF programs, a key policy implication of our findings is that populations may not uniformly reject all kinds of conditionality but have well-defined preferences over policy conditionality. The results also provide insights into the nature of these preferences, specifically whether people are willing to pay for normatively desirable policy goals.