Why it Matters Who Runs the IMF and the World Bank-Updated October 2003

Nancy Birdsall

No 22, Working Papers from Center for Global Development

Abstract: Increasing integration has made the great challenge of reducing poverty and advancing human development more achievable than ever, and more dependent than ever on good global economic governance. In this paper I set out the economic logic for why good global economic governance matters for reducing poverty and inequality in the world, and then develop several arguments for how better representation of developing countries in the IMF, the World Bank, and other multilateral institutions would make those institutions more effective in that task. The arguments include the long-run viability of new financing of the institutions, and their effectiveness in managing the political economy challenges of using conditionality. To illustrate the possible link between better representation and effectiveness, I discuss the example of the Inter-American Development Bank, where the developing country borrowers control 50 percent of the votes and the Presidency. I close with a discussion of the dilemma of reconciling the need for sustaining the financial and political support of the rich country members of these global institutions, with stronger poor country representation to ensure their long-run legitimacy and effectiveness.

Keywords: multilateral organizations; integration; poverty; human development (search for similar items in EconPapers)
JEL-codes: D63 F35 F36 F53 I31 I32 O15 O19 O40 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2003-01
New Economics Papers: this item is included in nep-fmk, nep-pke and nep-sea
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Citations: View citations in EconPapers (3)

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