@TechReport{iza:izadps:dp18350,
            	author={Mehrotra, Santosh and Hassan, Shady},
            	title={The 'Despotic Leviathan' and Its Financial Architecture: How IMF Conditionalities Deepen Inequality},
            	year={2025},
	month={Dec},
            	institution={Institute of Labor Economics (IZA)},
            	address={Bonn},
            	type={IZA Discussion Paper},
            	number={18350},
            	url={https://www.iza.org/publications/dp18350},
	abstract={This paper examines how IMF policies contribute to the inequality in MENA, and to a Middle-Income Trap (MIT).  Developing a theory  expanding Acemoglu and Robinson’s “Narrow Corridor” framework, it shows how IMF conditions align domestic elite incentives with creditor interests through a principal-agent lens. Using 2020-2025 data, its analysis reveals IMF monetary policies create rent-seeking structures that institutionalize inequality and suppress growth. The paper identifies an “engineered r>g dynamic” as a quantifiable signature of this extraction, empirically verified in Egypt. It establishes a causal link between financial/monetary policy (interest rates, debt compounding) and the “Despotic Leviathan” state formation.},
	keywords={political economy;domestic debt;inequality;IMF conditionality;state capture;Middle-Income Trap;Egypt},
            }