Archive for September, 2011

political economy

Tuesday, September 13th, 2011

First Slide
Title: IMF Goals
• Help Membership Gov’s take advantage of the opportunities and manage challenges presented by Globalization and economic development.
• Provide analysis of economic trends and performance.
• Forecast and alert members of potential problems.
• Provide a forum for member countries to discuss economic policy.
• Provide know how to member countries on how to approach economic problems.
• Help developing countries to maintain macroeconomic stability and reduce poverty.

Second Slide
Title: How does IMF accomplish these Goals?
• Surveillance
• Technical Assistance
• Lending
http://www.imf.org/external/pubs/ft/wp/wp9790.pdf

Third Slide: Case Study: 1982 Debt Crisis: Mexico in “the Lost Decade”

Criticisms to add:
IMF has been seen as politicized to support policy goals of its major shareholders.
Examples: IMF’s aid to mexico in the 90s. IMF’s aid to former communist states
IMF provides short term balance-of-payments problems instead of larger problems. The result is that many criticize the IMF for having an excessively short-term horizon and concentrating too much on cutting budget deficits and controlling credit while neglecting the core issues that affect a country’s capacity to produce goods and services. (“Why the IMF Needs Reform) Zanny Minton-Beddoes
Reluctance of member countries to increase IMF quotas has meant that the size of the resources made available to the fund has not kept pace with the size of the world economy as measured for instance by world trade. Also, the inability to change the quota system causes emerging market countries to be under represented and more mature countries to be overrepresented. (IMF: Victim of Its Own Success or Institutional Failure?) Paul R. Masson.