This paper analyzes the availableliterature about the effects of structural adjustmentprograms (SAPs) on the environment and the convincingevidence for their success or failure. The studies coveredrefer to the SAPs by the World Bank as well as to generalgovernment programs that have similar policy implications.SAPs are designed to reform economies to become moreliberalized and export-oriented while reducing the role ofgovernments that have become inefficient bureaucracies.Because of the implications of policies such as debtaccumulation and trade, a concise literature review on debtand trade liberalization is also included. Despite thecontroversy surrounding structural adjustment and theenvironment, the debate has been largely based on anecdotalevidence and country case studies. Most of the studiesreviewed are not quantitative and have not applied rigorousstatistical methods. The conclusions of studies on theeffects of structural adjustment (SA) on the environment arestrongly influenced by what is examined, the sectoral level,and the stage of the SA process. The infrequency ofhigh-caliber studies is due to data scarcity and statisticallimitations. There is little reason to doubt, however, thatover the longer term, the sorts of changes in incentivestructures and relative price changes brought about by SAlending will have an impact on the environment. Economiesundergoing SA will experience both growth (assuming thesuccess of SAPs) and structural shifts, which will affectthe extraction of natural resources and the level ofpollution emissions.
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