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Since 1965 international financial conditions have become a major factor in economics and politics within the less developed countries (LDCs). The impact of international finance on the LDCs provides an excellent opportunity to analyze the relationship between external events and LDC domestic economic and political development. There was in fact great variation in the response of LDC debtors to similar international financial circumstances. Some liberalized their trade and investment policies as they borrowed; others tightened them. Some used borrowed funds productively; others experienced enormous capital flight. The 1982-1984 financial crisis saw the rise of new democratic regimes in some countries and the consolidation of authoritarianism in others.