01767cas a2200241 a 4500 AALejournalIMF010147 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451926477 1018-5941 BD-DhAAL BD-DhAAL International Monetary Fund. Externalities. Incentives, and Economic Reforms. Washington, D.C. : International Monetary Fund, 1990. 1 online resource (40 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students The paper emphasizes the role of institutions and incentives in the presence of externalities. An economy with multiple public decision makers is likely to experience 'overspending,' 'undertaxing,' 'overborrowing,' and 'overinflation' unless effective institutions exist for overcoming coordination failure. External financing may weaken incentives for adjustment over the longer run unless assistance is made conditional on fundamental institutional reforms. The paper also analyzes reforms that strengthen incentives to provide effort. Uncertainty regarding future taxes reduces present effort and the responsiveness of output to market signals. In addition, the paper addresses the adverse effects of bank insurance and soft budget constraints. Mode of access: Internet IMF Working Papers; Working Paper ; No. 1990/010 Full text available on IMF http://elibrary.imf.org/view/journals/001/1990/010/001.1990.issue-010-en.xml IMF e-Library