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Congressional Politics of Financing the International Monetary Fund

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Author Info
Broz, J. Lawrence
Hawes, Michael Brewster
Abstract

We address the question of how international public goods are financed by analyzing voting in the U.S. Congress on legislation to increase the U.S. contribution to the International Monetary Fund (IMF). We argue that legislators are more likely to vote in favor of an increase (1) the more campaign contributions they obtain from banks that specialize in international lending, and (2) the greater the share of high-skilled proglobalization workers in their districts. The first argument supports the inference that a financially strong IMF mitigates the risks of international lending, to the benefit of the lending banks. The second reflects our claim that voters view the IMF as a positive force for global economic integration that following Stolper-Samuelson reasoning benefits high-skilled workers. Lastly, we analyze IMF loan decisions and find modest support for the claim that IMF policy reflects the interests of major international banks. Overall, our results suggest that private actors within the United States have individual stakes in funding the IMF.We presented earlier versions of this paper at the 8th Annual International Society for New Institutional Economics Conference (ISNIE), Tucson, Ariz., September October 2004, and at the Delegation to International Organization Conference, Del Mar, Calif., September 2003. We thank participants for comments. We also thank Michael Hiscox, Mathew McCubbins, J. R. DeShazo, David Lake, Jeffry Frieden, James Vreeland, William R. Clark, Erica Gould, Joseph Joyce, Devesh Kapur, Louis Pauly, Shanker Satyanath, Beth Simmons, and Michael Tierney for suggestions; and Mark Farrales and Molly James for excellent research assistance.

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Article provided by Cambridge University Press in its journal International Organization.

Volume (Year): 60 (2006)
Issue (Month): 02 (April)
Pages: 367-399
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Handle: RePEc:cup:intorg:v:60:y:2006:i:02:p:367-399_06

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  1. Axel Dreher & Bernhard Boockmann, 2007. "Do Human Rights Offenders Oppose Human Rights Resolutions in the United Nations?," Working papers 07-163, KOF Swiss Economic Institute, ETH Zurich. [Downloadable!]
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