DOCSLIB.ORG

Angling for Influence: Institutional Proliferation in Development Banking

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Angling for Influence: Institutional Proliferation in Development Banking Angling for Influence: Institutional Proliferation in Development Banking Tyler Pratt∗ Yale University December 6, 2019 ∗Assistant Professor, Department of Political Science, Yale University. Email: [email protected]. I am grateful to Eric Arias, Sarah Bush, Christina Davis, Julia Gray, Kosuke Imai, Robert Keohane, Amanda Ken- nard, James Lee, Melissa Lee, Christoph Mikulaschek, Julia Morse, and Kelsey Pratt for valuable feedback on this project. Abstract Why do states build new international organizations (IOs) in issue areas where many institutions already exist? Prevailing theories of institutional creation emphasize their ability to resolve market failures, but adding new IOs can increase state uncertainty and rule inconsistency. I argue that institutional proliferation can be explained by the failure of existing IOs to adapt to shifts in the distribution of state power. States expect decision-making rules within IOs to reflect their material power; when it does not, they construct new organizations that provide them with greater institutional control. To test this argument, I examine the proliferation of multilateral development banks since 1944. I leverage a natural experiment rooted in the allocation of World Bank votes at Bretton Woods to show that the probability of institutional proliferation is higher when power is misaligned in existing institutions. My results suggest that conflict over shifts in global power contribute to the fragmentation of global governance. 1 Introduction Since the end of the World War II, states have constructed international institutions at a breakneck pace. The number of formal international organizations (IOs) grew from less than a hundred in 1950 to over 300 by the year 2000. In the same time period, the volume of multilateral treaties registered with the United Nations increased from roughly 500 to 4,000. This growth has generated significant crowding of governance institutions in issue areas like trade, human rights, and finance, where multiple IOs compete for authority to regulate state behavior. Recently, the proliferation of multilateral development banks has drawn particular scrutiny, as new organizations like the Asian Infrastructure Investment Bank (AIIB) and the New Development Bank (NDB) challenge the primacy of established institutions. The proliferation of IOs is meaningful because it has the potential to undermine inter- national cooperation. International institutions are believed to play an important role in world politics, managing interdependence and facilitating bargaining among states. But the fragmentation of global governance across multiple IOs often leads to coordination prob- lems, redundancy, and rule conflict (Raustiala & Victor, 2004; Alter & Meunier, 2009).1 Lamenting the proliferation of development aid institutions, a large conference of develop- ment ministers argued that \the effectiveness of aid is reduced when there are too many duplicating initiatives" and cautioned against \creating separate new channels that risk fur- ther fragmentation" (Accra Agenda for Action, 2008). Given the challenges associated with overlapping IOs, why do states continue to construct them? Classic theories of IO formation argue that states build IOs to reduce transaction costs, overcome market failures, and capture gains from cooperation (Keohane, 1984). This rational institutionalist account provides a convincing explanation of IO construction when 1While some argue that institutional crowding does not necessarily undermine cooperation, at the very least sustained proliferation demands a high level of policy coordination among IOs (Gehring & Faude, 2014; Abbott et al. , 2015; Pratt, 2018). 1 few prior institutions exist (such as the formation of the World Bank in 1944), but is less compelling when many institutions are already present (e.g., the creation of the AIIB in 2015). In the latter context, institutional proliferation raises transaction costs by increasing uncertainty and introducing multiple bargaining venues. Rather than a rational response to an underlying cooperation problem, I argue that insti- tutional proliferation often stems from a contest for bargaining power among states. States seek decision-making power in IOs because cooperation involves distributional conflicts. Con- trol over institutions allows states to push negotiations toward their favored outcome. States that are dissatisfied with their influence | often because existing institutions have failed to adapt to changes in the global distribution of power | build new institutions in which they have greater control. Overlapping IOs are a byproduct of state attempts to increase their influence over multilateral outcomes. This argument suggests that institutional proliferation is often rooted in contestation associated with power transitions. When IOs are created, member states typically design formal and informal rules so that multilateral influence reflects states' underlying material power (Gruber, 2000; Odell, 2000; Stone, 2011). As the distribution of state power shifts, however, institutions do not smoothly adapt (Kaya, 2015; Lipscy, 2017). A power misalign- ment emerges when a state's influence within the institution is not commensurate with its unilateral power. States engage in institutional proliferation as part of a strategy to rectify these misalignments. To test the link between power misalignment and institutional proliferation, I examine the creation of multilateral development banks. This regime grew from a single development bank in 1944 (the World Bank) to at least twenty-eight overlapping institutions in 2019. These organizations are important actors in world politics, disbursing over $400 billion in development finance since the year 2000.2 The issue area has a clear functional rationale for 2Calculations reflect OECD data on total flows from international financial institutions. 2 institutionalized cooperation: the coordination of global development finance efforts. It has also experience a substantial amount of proliferation that is difficult to explain on purely functional grounds.3 The power misalignment argument suggests that states are more likely to construct devel- opment banks when their influence in existing bodies { and especially the central institution (the World Bank) | falls short of their underlying material power. This very logic was prevalent in media and policy debates surrounding the creation of the Chinese-led AIIB in 2015, which frequently cited Chinese under-representation in the World Bank and IMF. Systematic testing of the argument, however, has been limited. Here, I examine whether the historical pattern of development bank proliferation is consistent with such an explanation. To do so, I collect an original data set on power misalignment in the World Bank and state participation in the founding of alternative development banks. Estimating the effect of power misalignment presents a difficult identification challenge, since state influence in international institutions is politically determined. States' decision- making power in IOs is shaped by confounding variables like alliance commitments and state preferences over the policy domain governed by the IO. I adopt two approaches to mitigate endogeneity. First, I leverage a natural experiment that occurred during negotiations pre- ceding the World Bank's creation. To satisfy a political promise to its wartime allies, the United States made an abrupt change to the formula used to allocate vote shares at the 1944 Bretton Woods conference. The formula change represents an exogenous shock to the influence of some World Bank member states, which I use to identify the causal effect of power misalignment on the creation of new development banks. In a second set of tests, I examine dynamic shifts in power misalignment that emerged after the World Bank's founding. These specifications assess whether a state is more likely 3In a recent paper examining growth in multilateral development banks (MDBs), Kellerman (2019) argues that \the proliferation of MDBs has resulted in an inefficient duplication of international institutions with overlapping functions" (107). 3 to participate in development bank proliferation as its economic growth outpaces its formal vote share in the World Bank. To minimize differences between over- and under-represented states, I employ covariate balancing propensity score matching (Imai & Ratkovic, 2014). Both sets of tests support the theory: states are more likely to construct new banks when power is misaligned in the World Bank. Under-representation in the World Bank by a single percentage point makes a state 6.8% more likely to participate in the creation of new development banks. These results establish the importance of power misalignment in spurring networks of overlapping IOs. The paper contributes to at least two distinct literatures in international relations. By tying IO proliferation to misalignments in power, I build on scholarship examining power transitions and conflict over adaptation of the international order. Over fifty years ago, Or- ganski (1968) highlighted the potential for shifts in state power to engender dissatisfaction and interstate conflict. Gilpin (1981) similarly examined how changes in the distribution of power generate disequilibrium and the potential for systemic war. Subsequent work illumi- nates how power shifts affect the survival and vitality of existing international institutions (Ikenberry, 2001). Recent studies detail how power transitions are manifested in prominent economic IOs, including
Load more

Recommended publications
  • The Bretton Woods Debates : a Memoir / Raymond F
    ESSAYS IN INTERNATIONAL FINANCE ESSAYS IN INTERNATIONAL FINANCE are published by the International Finance Section of the Department of Economics of Princeton University. The Section sponsors this series of publications, but the opinions expressed are those of the authors. The Section welcomes the submission of manuscripts for publication in this and its other series. Please see the Notice to Contributors at the back of this Essay. The author of this Essay, Raymond F. Mikesell, is Profes- sor of Economics at the University of Oregon. He was an economic advisor at the Bretton Woods conference in 1944 and a member of the staff of the President’s Council of Economic Advisors from 1955 to 1957. He was a senior research associate at the National Bureau of Economic Research from 1970 to 1974 and a consultant to the World Bank in 1968-69 and 1991-92. He has published a number of books and articles on international finance. This is his seventh contribution to the Section’s publications. PETER B. KENEN, Director International Finance Section INTERNATIONAL FINANCE SECTION EDITORIAL STAFF Peter B. Kenen, Director Margaret B. Riccardi, Editor Lillian Spais, Editorial Aide Lalitha H. Chandra, Subscriptions and Orders Library of Congress Cataloging-in-Publication Data Mikesell, Raymond Frech. The Bretton Woods debates : a memoir / Raymond F. Mikesell. p. cm. — (Essays in international finance, ISSN 0071-142X ; no. 192) Includes bibliographical references. ISBN 0-88165-099-4 (pbk.) : $8.00 1. United Nations Monetary and Financial Conference (1944: Bretton Woods, N.H.)—History 2. International Monetary Fund—History. 3. World Bank—History. I.
    [Show full text]
  • The Final Few Completing the Universal Membership of the Imf James M
    CIGI PAPERS NO. 89 — FEBRUARY 2016 THE FINAL FEW COMPLETING THE UNIVERSAL MEMBERSHIP OF THE IMF JAMES M. BOUGHTON THE FINAL FEW: COMPLETING THE UNIVERSAL MEMBERSHIP OF THE IMF James M. Boughton Copyright © 2016 by the Centre for International Governance Innovation The opinions expressed in this publication are those of the author and do not necessarily reflect the views of the Centre for International Governance Innovation or its Board of Directors. This work is licensed under a Creative Commons Attribution — Non-commercial — No Derivatives License. To view this license, visit (www.creativecommons.org/ licenses/by-nc-nd/3.0/). For re-use or distribution, please include this copyright notice. Centre for International Governance Innovation, CIGI and the CIGI globe are registered trademarks. 67 Erb Street West Waterloo, Ontario N2L 6C2 Canada tel +1 519 885 2444 fax +1 519 885 5450 www.cigionline.org TABLE OF CONTENTS iv About the Global Economy Program iv About the Author 1 Executive Summary 1 Introduction 2 The Role of the Cold War 7 After the Cold War 10 Conclusions 11 Works Cited 12 About CIGI 12 CIGI Masthead CIGI PAPERS NO. 89 — February 2016 ABOUT THE GLOBAL ECONOMY ABOUT THE AUTHOR PROGRAM Addressing limitations in the ways nations tackle shared economic challenges, the Global Economy Program at CIGI strives to inform and guide policy debates through world-leading research and sustained stakeholder engagement. With experts from academia, national agencies, international institutions and the private sector, the Global Economy Program supports research in the following areas: management of severe sovereign debt crises; central banking and international financial regulation; China’s role in the global James M.
    [Show full text]
  • Bretton-Woods Conference: the Soviets Perspective
    Erasmus University Rotterdam Erasmus School of History, Culture and Communication M.A. History of Society Global History and International Relations Bretton-Woods Conference: the Soviets Perspective Student: Natalia Klyausova Student number: 429910 Supervisor: Prof. Dr. Ben Wubs 2015/2016 Abstract This paper examines the reasons of the Soviet Union’s decision not to ratify the Bretton-Woods agreement. The Bretton-Woods Conference was a symbol of the Twentieth Century, which left a mark in the international financial history. The Conference gathered more than 730 delegates from 44 countries that wanted to avoid the financial catastrophe in the postwar period. The Soviet Union participated in the pre-conference meetings and was actively engaged in defending its national interests at the Bretton-Woods Conference. However, the Soviet Union refused to enter the newly founded IMF and IBRD, and reasons behind the refusal are merely mentioned in various sources. The most common information that could be found is that the Soviet Union never officially explained its decision. The result of the work shows that the Soviet officials studied and favored the Bretton-Woods agreements, explaining that the Soviet Union could derive a profit from it. Moreover, the Soviet economic technicians prepared a set of the recommendations which the Soviet government needed to apply before entering the Bretton- Woods institutions. Nevertheless, the Soviet Union never ratified the Bretton-Woods outcome. Although, there are no official reports or papers which might shed the light on the final decision of Stalin, who refused to become a part of the new financial order, this work still contributes to the common knowledge of Bretton-Woods and the role of the Soviet Union in the Bretton- Woods system and the postwar world.
    [Show full text]
  • Angling for Influence: Institutional Proliferation in Development Banking
    Angling for Influence: Institutional Proliferation in Development Banking Tyler Pratt∗ Princeton University February 13, 2017 Abstract Why do states construct new international organizations (IOs) in issue areas that are already densely institutionalized? Functional theories point to the cooperative benefits that states gain from international institutions. Yet a growing literature on \international regime complexity" highlights the pathologies that arise when multiple, overlapping institutions collectively govern a particular issue. I argue regime complexes arise from a contest for bargaining power among states. The rules that confer influence in multilateral institutions often fail to adapt to the evolving distribution of state power. States engage in strategic institutional proliferation when their influence in existing institutions is constrained by outdated rules. I test this argument in the growing regime complex for development lending, an issue area with a single dominant institution (the World Bank) and a growing collection of alternative development banks. To overcome the endogenous assignment of influence in the World Bank, I leverage a natural experiment associated with the allocation of states' formal vote shares. A last minute change in the vote share formula, recorded in archival records, provides exogenous variation in states influence in the Bank. Results show that states are significantly more likely to engage in IO proliferation when their influence in the World Bank is misaligned with their underlying material power. ∗Ph.D.
    [Show full text]
  • The Governance of the IMF in a Global Economy Ariel Buira1
    The Governance of the IMF in a Global Economy Ariel Buira1 I. Introduction Following the commitment of all participants in the Monterrey Consensus to increase the voice and participation of developing countries and transition economies in the Breton Woods Institutions, the issue of governance has come to the fore of the IMF and World Bank. The Monterrey commitment was renewed in the IMFC and Development Committee communiqués of April 12 and 13, 2003, and reflected in recent administrative steps to strengthen the capacity of African constituencies. Moreover, since 1997, following the Executive Board’s approval of the Guidance Note on Governance, the IMF has increased its attention to issues of governance issues among its member countries. The promotion of transparency and accountability are at the core of the IMF’s efforts to ensure the efficient use of public resources, as well as the domestic ownership of IMF-supported reform programs. In recent years the IMF has developed instruments to help countries identify potential weaknesses in their institutional and regulatory frameworks that could give rise to poor governance, and to design and implement remedial measures to an extent well beyond what was envisaged in 1997. With resources of over $300 billion and an expanded mandate, the IMF is possibly the most powerful of all international institutions. In view of its great influence, two questions on the quality of its own governance arise: 1. How to attain the adequate voice and representation of all members in the decisionmaking process of the institution and, 2. Does the IMF meet the standards of transparency and accountability needed to ensure the legitimacy of its decisions, the ownership by member countries of the programs it supports, and the proper use of the public resources at its disposal? 1The views expressed in this paper are strictly personal.
    [Show full text]
  • THE RATIONALE for MULTILATERAL LENDING a CRITICAL ASSESSMENT Yilmaz Akyüz1
    Draft for discussion 5 July 2004 THE RATIONALE FOR MULTILATERAL LENDING A CRITICAL ASSESSMENT Yilmaz Akyüz1 I. Capital market failures and multilateral lending Multilateral lending has been a central element in international economic cooperation since the establishment of the Bretton Woods Institutions (BWIs) towards the end of the Second World War. These institutions in general and their lending activities in particular were designed to address specific challenges confronting the architects of the postwar international economic order. These included the need, on the one hand, to avoid the repetition of the difficulties that traumatised the world economy during interwar years, and on the other hand, to repair the damages inflicted by the war on the productive capacity and living standards of the countries involved. Accordingly, two distinct objectives were attached to multilateral lending: restoration and maintenance of international economic stability, and reconstruction and development. The world economic and political landscape has undergone significant changes since the Bretton Woods Conference (BWC), including the end of colonialism, the rise 1 Second holder of the Tun Ismail Ali Chair in Monetary and Financial Economics, University of Malaya, Kuala Lumpur; and former Director of Division on Globalization and Development Strategies, and Chief Economist, UNCTAD. Paper prepared for the UNDP Project “Public Finance in a Globalizing World”. I am grateful to Richard Kozul-Wright, Jan Kregel, Inge Kaul, Ron Mendoza and two anonymous reviewers for comments and suggestions. None of the persons mentioned are, of course, responsible for any errors or omissions. 2 and the fall of communism, closer global economic integration, and a rapid development of international financial markets.
    [Show full text]
  • “Money, Banks and Finance in Economic Thought”, University of Lille, Lille (France), 23-25 May 2019
    EARLY REACTIONS TO THE KEYNES PLAN: THE RADICAL CRITICISMS FROM SCHUMACHER, BALOGH AND KALECKI ESHET Conference 2019 on “Money, banks and finance in economic thought”, University of Lille, Lille (France), 23-25 May 2019 DRAFT PAPER PLEASE DO NOT QUOTE WITHOUT PERMISSION Adrien Faudot, PhD1 CREG, Université Grenoble Alpes, France Edoardo Beretta, PhD2 Università della Svizzera italiana (USI), Lugano, Switzerland & Franklin University Switzerland (FUS), Sorengo-Lugano, Switzerland. Abstract The Keynes plan was considered upon its release, thanks to the international prestige of the British economist as well as the cleverness of his proposal, as particularly worthy of interest. If (as expected) economists embracing orthodox views on money criticized the plan, less known criticisms came from the Keynesian circles. Several former close collaborators of J. M. Keynes offered comments and asked for amendments to his draft plan as well as for the improvement of the scheme of the Clearing Union, which the British economist wanted to design. In the light of the aforesaid, the following paper analyses the publications of Ernst F. Schumacher, Thomas Balogh, and Michal Kalecki appeared right after the Keynes plan. In fact, these authors provided early as well as radical judgements anticipating some faults in his proposal and targeting the sustainability of an effective Clearing Union. JEL classification codes: B2, B3, E42. Keywords: International Clearing Union, Balogh, Kalecki, Schumacher Introduction The Keynes plan is the most commented project to reform the international monetary system to this day. It was rejected by the United States delegation and had, therefore, no chance to be endorsed at the Bretton Woods conference in 1944.
    [Show full text]
  • BRETTON WOODS REVISITED Bretton Woods Revisited
    BRETTON WOODS REVISITED Bretton Woods Revisited EVALUATIONS OF THE INTERNATIONAL MONETARY FUND AND THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Papers delivered at a conference at Queen's University, Kingston, Canada and edited by A. L. KEITH ACHESON JOHN F. CHANT MARTIN F. J. PRACHOWNY Palgrave Macmillan ISBN 978-1-349-01523-8 ISBN 978-1-349-01521-4 (eBook) DOI 10.1007/978-1-349-01521-4 © University of Toronto Press 1972 Softcover reprint of the hardcover 1st edition 1972 All rights reserved. No part of this publication may be reproduced or transmitted, in any form or by any means, without permission. First published in Canada 1972 First published in the United Kingdom 1972 Published by THE MACMILLAN PRESS LTD London and Basingstoke Associated companies in New York Toronto Dublin Melbourne Johannesburg and Madras SBN 333 13586 5 To our wives Mary, Bev, and Marguerite Contents Preface ix Introduction xi Memories and Histories 3 SIR ROY HARROD Problems perceived in the International Financial System 5 RICHARD N. GARDNER The Political Setting 20 LOUIS RASMINSKY Canadian Views 34 WILLIAM A. MACKINTOSH A.F.W. PLUMPTRE JOHN J. DEUTSCH What has been done? 49 EDWARD M. BERNSTEIN The Evolution of the International Monetary Fund 51 DAVID W. SLATER Commentary 66 RAYMOND F. MIKESELL The Emergence of th~ World Bank as a Development Institution 70 GRANT L. REUBER Commentary 85 viii Bretton Woods Revisited Speculations and Futures 89 ROBERT A. MUNDELL The Future of the International Financial System 91 ROBERT M. STERN Commentary 104 RAUL PREBISCH A View from the Developing World 107 GERALD K.
    [Show full text]
  • Reflections on the International Monetary System
    ESSAYS IN INTERNATIONAL FINANCE ESSAYS IN INTERNATIONAL FINANCE are published by the International Finance Section of the Department of Economics of Princeton University. The Section sponsors this series of publications, but the opinions expressed are those of the authors. The Section welcomes the submission of manuscripts for publication in this and its other series. Please see the Notice to Contributors at the back of this Essay. The author of this Essay, Ariel Buira, is Deputy Governor of the Bank of Mexico, where he previously served as Director of International Affairs. He was a member of the International Monetary Fund’s Staff from 1970 to 1975 and of the Fund’s Executive Board from 1978 to 1982. His monographs and articles on domestic and international monetary questions have been published in a number of languages. PETER B. KENEN, Director International Finance Section INTERNATIONAL FINANCE SECTION EDITORIAL STAFF Peter B. Kenen, Director Margaret B. Riccardi, Editor Lillian Spais, Editorial Aide Lalitha H. Chandra, Subscriptions and Orders Library of Congress Cataloging-in-Publication Data Buira, Ariel. Reflections on the international monetary system. p. cm. — (Essays in international finance, ISSN 0071-142X ; no. 195) Includes bibliographical references. ISBN 0-88165-102-8 (pbk.) : $8.00 1. International Monetary Fund. 2. International finance. I. Title. II. Series. HG3881.158R44 1995 332.1′52—dc20 95-1091 CIP Copyright © 1995 by International Finance Section, Department of Economics, Princeton University. All rights reserved. Except for brief quotations embodied in critical articles and reviews, no part of this publication may be reproduced in any form or by any means, including photocopy, without written permission from the publisher.
    [Show full text]
  • Getting a Seat at the IMF Executive Board Table By: Bessma Momani
    Title: Getting a Seat at the IMF Executive Board Table By: Bessma Momani Assistant Professor, Departments of Political Science and History, University of Waterloo Senior Fellow, Centre for International Governance and Innovation [email protected] Paper Submitted for Consideration to “The Political Economy of International Organizations’ 3-8 February 2008, Ascona, Switzerland Abstract: How are seats allocated on the International Monetary Fund’s (IMF) Executive Board? Are seats determined by bureaucratic interests, strategic power politics, or by a combination of the two? The theoretical debate on this issue is lively, with hypothesizing taking place on every front. What is sorely lacking, however, is empirical evidence of actual practice. Developing an evidence-based understanding of the manner in which IMF member states gain access to seats at the Executive Board is particularly crucial now, given the centrality of this issue to current debates about the very future of the IMF itself. As part of a multi-case study, this paper will present historical context to this current policy dilemma, illustrating the political process involved in getting a seat at the Executive Board in the cases of Russia and Switzerland. Introduction Created in 1944 as part of the post-World War strategy to prevent another Great Depression, the International Monetary Fund (IMF) was ideally meant to coordinate financing and technical advice to member countries experiencing economic imbalances. Today, however, the IMF is frequently criticized for its failure to be accountable and legitimate in the eyes of its own members. Recently, many prominent policymakers across the world have argued that the IMF’s legitimacy crisis can only be resolved by re-allocating the 24 seats on its Executive Board in a way that gives greater voice to countries that are seen to be underrepresented.
    [Show full text]
  • IMF Governance, the Asian Financial Crisis, and the New International Financial Architecture
    IMF Governance, the Asian Financial Crisis, and the New International Financial Architecture Bartram S. Brown* I. Introduction The International Monetary Fund (IMF) was created over 50 years ago as a key pillar of the Post World War II international economic order. The ultimate goal of the international financial institutions (IFIs) of that era was to create a more open and global economy. Now that a high degree of economic globalization has been achieved, a new “international financial architecture” is needed. The Asian Financial crisis of 1997­1999 was in many ways a turning­point. It provided dramatic proof that the globalization of capital flows has left national economies more vulnerable than ever to panics and other external developments. 1 The crisis also raised questions about the role of the IMF in the newly globalized economy. The IMF’s original role was principally to manage the fixed exchange rate system which collapsed in the 1970s. It has adapted itself into an organization that makes loans to developing countries and provides them with economic policy advice often unrelated to exchange rate stability. 2 By conditioning its loans upon compliance with its policy advice the IMF has evolved into the international financial policeman of the world economy. As the Asian crisis dawned, the Fund offered advice and formulated new programs of conditional financial assistance to Thailand, Indonesia, and other affected Asian states. Some aspects of these IMF programs have been criticized for contributing to the panic, adding fuel to the calls for a new international financial architecture. As its influence has grown, the IMF has resisted adapting its policies to changed conditions and challenges.
    [Show full text]
  • Another Seat at the Board: Russia's IMF Executive Director
    Bessma Momani Another seat at the board Russia’s IMF executive director Created in 1944 as part of the postwar strategy to prevent another great depression, the International Monetary Fund (IMF) was ideally meant to coordinate financing and technical advice to member countries experienc - ing economic imbalances. Today, however, the IMF is frequently criticized for its failure to be accountable and legitimate in the eyes of its own mem - bers. Recently, many prominent policymakers across the world have argued that the IMF ’s legitimacy crisis can only be resolved by reallocating the 24 seats on its executive board in a way that gives greater voice to countries that are seen to be underrepresented. Specific proposals involve decreasing and consolidating European representation and making the executive directors of Russia, Saudi Arabia, and China—which do not represent any other members and therefore have sole constituency-free seats—absorb other fund members in their constituencies. Ideally, this could free up seats at the Bessma Momani is assistant professor in the departments of political science and history at the University of Waterloo. She is also a senior fellow at the Centre for International Governance and Innovation . The author is grateful to the IMF archives for access to key documents and to the Social Sciences and Humanities Research Council for funding. She would like to thank all interviewees for their time and consideration. Comments by Domenico Lombardi, Eric Helleiner, Randall Germain, and a number of IMF staff and executive directors, who asked to remain anonymous, were greatly appreciated. | 916 | International Journal | Autumn 2007 | | Another seat at the board | executive board and allow quota increases for those deemed underrepre - sented or unheard, namely emerging market economies and less developed countries .1 While policymakers have been discussing how to recompose the exec - utive board, little academic attention has been devoted to this important organ of international monetary decision-making.
    [Show full text]