Why do you think the IMF required countries with large deficits, like those in Eastern Europe, to

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Why do you think the IMF required countries with large deficits, like those in Eastern Europe, to cut spending rather than increase it?


The International Monetary Fund (IMF) reported that it acted effectively in combating the global recession, especially in Eastern Europe. The IMF made $163 billion available to developing countries. The IMF required countries with large deficits to cut spending or not increase it, but it urged the United States, Western European countries, and China to run deficits to stimulate their economies.

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Foundations of Macroeconomics

ISBN: 978-0134492001

8th edition

Authors: Robin Bade, Michael Parkin

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