Advanced Search
MyIDEAS: Login to save this article or follow this journal

“The silent revolution:” How the staff exercise informal governance over IMF lending

Contents:

Author Info

  • Jeffrey Chwieroth

    ()

Registered author(s):

    Abstract

    This paper examines how the staff exercise informal governance over lending decisions of the International Monetary Fund (IMF or Fund). The essential component of designing any IMF program, assessing the extent to which a borrowing country is likely to fulfill its policy commitments, is based partly on informal staff judgments subject to informal incentives and normative orientations not dictated by formal rules and procedures. Moreover, when country officials are unable to commit to policy goals of the IMF, the IMF staff may bypass the formal channel of policy dialogue through informal contacts and negotiations with more like-minded actors outside the policymaking process. Exercising informal governance in these ways, the staff are motived by informal career advancement incentives and normative orientations associated with the organization’s culture to provide favorable treatment to borrowers composed of policy teams sympathetic toward their policy goals. The presence of these sympathetic interlocutors provides the staff both with greater confidence a lending program will achieve success and an opportunity to support officials who share their policy beliefs. I assess these arguments using a new dataset that proxies shared policy beliefs based on the professional characteristics of IMF staff and developing country officials. The evidence supports these arguments: larger loan commitments are extended to countries where government officials and the Fund staff share similar professional training. The analysis implies informal governance operates in IOs not just via state influence but also through the evolving makeup, incentive structure, and normative orientations of their staffs. Copyright Springer Science+Business Media New York 2013

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://hdl.handle.net/10.1007/s11558-012-9154-9
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Bibliographic Info

    Article provided by Springer in its journal The Review of International Organizations.

    Volume (Year): 8 (2013)
    Issue (Month): 2 (June)
    Pages: 265-290

    as in new window
    Handle: RePEc:spr:revint:v:8:y:2013:i:2:p:265-290

    Contact details of provider:
    Web page: http://www.springer.com/business/sociology/journal/11558

    Order Information:
    Web: http://link.springer.de/orders.htm

    Related research

    Keywords: IMF; Organizational culture; Professional training; F53; F33;

    Find related papers by JEL classification:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Carmen M. Reinhart & Kenneth S. Rogoff, 2009. "This Time Is Different: Eight Centuries of Financial Folly," Economics Books, Princeton University Press, edition 1, volume 1, number 8973.
    2. Finch, C.D., 1989. "The Imf: The Record And The Prospect," Princeton Studies in International Economics, International Economics Section, Departement of Economics Princeton University, 175, International Economics Section, Departement of Economics Princeton University,.
    3. Braumoeller, Bear F., 2004. "Hypothesis Testing and Multiplicative Interaction Terms," International Organization, Cambridge University Press, Cambridge University Press, vol. 58(04), pages 807-820, October.
    4. Allan Drazen, 2002. "Conditionality and Ownership in IMF Lending: A Political Economy Approach," IMF Staff Papers, Palgrave Macmillan, vol. 49(Special i), pages 36-67.
    5. Koremenos, Barbara & Lipson, Charles & Snidal, Duncan, 2001. "The Rational Design of International Institutions," International Organization, Cambridge University Press, Cambridge University Press, vol. 55(04), pages 761-799, September.
    6. Colander, David & Klamer, Arjo, 1987. "The Making of an Economist," Journal of Economic Perspectives, American Economic Association, vol. 1(2), pages 95-111, Fall.
    7. Fang, Songying & Stone, Randall W., 2012. "International Organizations as Policy Advisors," International Organization, Cambridge University Press, Cambridge University Press, vol. 66(04), pages 537-569, October.
    8. Broz, J. Lawrence & Hawes, Michael Brewster, 2006. "Congressional Politics of Financing the International Monetary Fund," International Organization, Cambridge University Press, Cambridge University Press, vol. 60(02), pages 367-399, April.
    9. Martin Steinwand & Randall Stone, 2008. "The International Monetary Fund: A review of the recent evidence," The Review of International Organizations, Springer, Springer, vol. 3(2), pages 123-149, June.
    10. Fischer, Stanley, 1997. "Applied Economics in Action: IMF Programs," American Economic Review, American Economic Association, vol. 87(2), pages 23-27, May.
    11. Haggard, Stephan, 1985. "The politics of adjustment: lessons from the IMF's Extended Fund Facility," International Organization, Cambridge University Press, Cambridge University Press, vol. 39(03), pages 505-534, June.
    12. Stone, Randall W., 2008. "The Scope of IMF Conditionality," International Organization, Cambridge University Press, Cambridge University Press, vol. 62(04), pages 589-620, October.
    13. Baltagi, Badi H. & Wu, Ping X., 1999. "Unequally Spaced Panel Data Regressions With Ar(1) Disturbances," Econometric Theory, Cambridge University Press, vol. 15(06), pages 814-823, December.
    14. Drazen, Allan, 2002. "Conditionality and Ownership in IMF Lending: A Political Economy Approach," CEPR Discussion Papers 3562, C.E.P.R. Discussion Papers.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:spr:revint:v:8:y:2013:i:2:p:265-290. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn) or (Christopher F Baum).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.