Legitimacy Dilemmas: The IMF's pursuit of country ownership

Third World Quarterly

Volumn 28, Issue 3, 2007, Pages 469-488

  Best, Jacqueline ^a  

^a UNIVERSITY OF OTTAWA   (Canada)

Author keywords

[No Author keywords available]

Indexed keywords

IMF; INSTITUTIONAL REFORM; SUSTAINABILITY;

EID: 34247187333     PISSN: 01436597     EISSN: 13602241     Source Type: Journal    
DOI: 10.1080/01436590701192231     Document Type: Article

References (89)

1. Without, of course, agreeing on the form that these reforms should take. D Lynch, 'Tired Fund struggles to reinvent itself; goal: Regain once-clear focus, energy', USA Today, 19 April 2006
2. ActionAid, 'ActionAid International comments on the IMF and World Bank spring meetings', 20 April 2006, at http://www.actionaidusa.org/ pr_imf_comments.php, accessed 24 May 2006
3. and S Ambrose & W Bello, Take the IMF off Life Support, 26 May 2006, Focus on the Global South, at http://www.focusweb.org/content/ view/933/, accessed 26 May 2006.
4. M King, 'Reform of the International Monetary Fund', Speech at the Indian Council for Research on International Economic Relations (ICRIER), New Delhi, 20 February 2006, at http://www.bankofengland.co.uk/publications/speeches/2006/speech267.pdf, accessed 18 May 2006.
5. R De Rato, The Managing Director's Report on Implementing the Fund's Medium-Term Strategy, Washington, DC: International Monetary Fund, 2006.
6. Ibid
7. IMF, 'IMF Board of Governors approves quota and related governance reforms', Press Release 06/205, Washington, DC, 18 September 2006.
8. See, for example,M Bukovansky, Legitimacy and Power Politics: The American and French Revolutions in International Political Culture, Princeton, NJ: Princeton University Press, 2002;
9. and Review of International Studies, special issue on 'Force and Legitimacy in World Politics', including articles by C Reus-Smit, N Rengger, R Falk & M Finnemore.
10. See, for example, L Seabrooke, The Social Sources of Financial Power: Domestic Legitimacy and International Financial Orders, Ithaca, NY: Cornell University Press, 2006;
11. and I Hurd, 'Legitimacy and authority in international politics', International Organization, 53, 1999, pp 379-408.
12. For a discussion of the traditional expert-based form of international organisation legitimacy, see M Barnett & M Finnemore, Rules for the World: International Organizations in Global Politics, Ithaca, NY: Cornell University Press, 2004.
13. W Connolly, 'Introduction: Legitimacy and modernity', in Connolly, Legitimacy and the State, Oxford: Basil Blackwell, 1984, p 2.
14. For a useful discussion of these three forms of legitimacy, see D Bodansky, 'The legitimacy of international governance: A coming challenge for international environmental law?', American Journal of International Law, 93 (3), 1999, pp 611-612.
15. Legitimacy is therefore by its nature a 'social fact' that cannot be adequately understood without reference to the social context within which it exists; is it also necessarily an intersubjective phenomenon that depends on mutual perception and communication for its reality. On social facts and intersubjective phenomena, see JG Ruggie, Constructing the World Polity: Essays on International Institutionalization, London: Routledge, 1998;
16. and J Searle, The Construction of Social Reality, New York: Free Press, 1995.
17. On their relevance in the context of international political economy, see J Kirshner, 'The study of money', World Politics, 52, 2000, pp 407-436;
18. and J Best, The Limits of Transparency: Ambiguity and the History of International Finance, Ithaca, NY: Cornell University Press, 2005, ch 2.
19. Although, as I will suggest below, the question of who selects the experts raises broader questions of legitimacy that cannot themselves necessarily be resolved by expert-based means.
20. Hurd, 'Legitimacy and authority in international politics'.
21. Bodansky, 'The legitimacy of international governance', pp 596-597.
22. On possible ways of doing so, and their attendant limits, see Hurd, 'Legitimacy and authority in international politics', pp 390-392.
23. Various critical treatments of the problem of legitimacy in international economic governance include Seabrooke, The Social Sources of Financial Power;
24. Barnett & Finnemore, Rules for the World; T Porter, Globalization and Finance, Cambridge: Polity Press, 2005;
25. and R Germain, 'Global financial governance and the problem of inclusion', Global Governance, 7 (4), 2001, pp 411-426.
26. Barnett & Finnemore, Rules for the World.
27. Bodansky, 'The legitimacy of international governance', pp 618-620.
28. Interview with senior IMF official, 29 August 2005.
29. W David, The IMF Policy Paradigm: The Macroeconomics of Stabilization, Structural Adjustment, and Economic Development, New York: Praeger, 1985, pp 33-43;
30. M De Vries, The International Monetary Fund 1966-1971, Vol 1,
31. The System under Stress: Narrative,Washington, DC: International Monetary Fund, 1976, pp 36 -365, 582;
32. and De Vries, The International Monetary Fund, 1972-1978, Vol 1,
33. Cooperation on Trial: Narrative and Analysis, Washington, DC: International Monetary Fund, 1985, pp 484, 488.
34. Barnett & Finnemore, Rules for the World, esp ch 6.
35. Interview with senior IMF official, 29 August 2005.
36. This is not, of course, to suggest that IMF policies did not previously have political consequences, particularly since the introduction of structural conditions in the 1980s, but rather to suggest that they have become more pronouncedly so since the new emphasis on institutions.
37. N Woods, 'Order, justice, the IMF, and the World Bank', in R Foot, J Gaddis & A Hurrell (eds), Order and Justice in International Relations, Oxford: Oxford University Press, 2003, pp 80-102.
38. J Best, 'Moralizing finance: The new financial architecture as ethical discourse', Review of International Political Economy, 10 (3), 2003, pp 579-603;
39. Best, 'The moral politics of IMF reforms: Universal economics, particular ethics', Perspectives on Global Development and Technology 4 (3-4), 2005, pp 357-378.
40. IMF Executive Board Decision 2603-(68/132), 20 September 1968.
41. IMF Executive Board Decision 6056-(79/38), March 1979. These earlier guidelines actually bear considerable resemblance to the new ones, as one senior IMF official pointed out. Interview with senior IMF official, 29 August 2005.
42. For an interesting internal overview of IMF structural conditionality, see IMF, Evaluation of Structural Conditionality in IMF-supported Programs: Issues Paper for an Evaluation by the Independent Evaluation Office, Washington, DC: International Monetary Fund, 2005.
43. For an excellent overview of the early history of Fund conditionality, see S Dell, 'On being grandmotherly: The evolution of IMF conditionality', Princeton Essays in International Finance, 144, 1981.
44. See also J Polak, 'The changing nature of IMF conditionality', Princeton Essays in International Finance, 184, 1991
45. J Boughton, Silent Revolution: The International Monetary Fund, 1979-1989, Washington, DC: International Monetary Fund, 2001, ch 13;
46. S Babb & A Buira, 'Mission creep, mission push and discretion in sociological perspective: The case of IMF conditionality', paper prepared for a G24 Technical Group Meeting, Geneva, 8-9 March 2004;
47. H James, 'From grandmotherliness to governance: The evolution of IMF conditionality', Finance and Development, 35 (4), 1998, pp 44-47;
48. and Joseph Gold, 'Conditionality', IMF Pamphlet Series, 31, 1979.
49. Interview with Jack Boorman, Consultant, Office of the Managing Director, and former head of Policy Review and Development, IMF, 31 August 2005.
50. Interview with former member of IMF Executive Board, 29 August 2005.
51. H Köhler, Streamlining Structural Conditionality in Fund-Supported Programs: Interim Guidance Note, Washington, DC: International Monetary Fund, 2000
52. and IMF, Guidelines on Conditionality, Washington, DC: International Monetary Fund, 2002.
53. For a discussion of the growing role of discretion in IMF structural conditionality, see Babb & Buira, 'Mission creep'.
54. IMF, Statement of the IMF Sta. on Principles Underlying the Guidelines on Conditionality, Washington, DC: International Monetary Fund, 2006, p 1.
55. See, for example, IMF, 'IMF completes internal review of ESAF', IMF Survey, 26 (15), 1997
56. and IMF, 'IMF releases report of external evaluation of ESAF following executive board review', IMF Survey, 27 (6), 1998.
57. S Schadler et al, IMF Conditionality: Experiences under Stand-by and Extended Arrangements, Part I: Key Issues and Findings, Occasional Paper No 128, Washington, DC: International Monetary Fund, 1995.
58. See also J Boughton, 'Who's in charge? Ownership and conditionality in IMF-supported programs', IMF Working Paper WP/03/191, 2003.
59. Interview with senior IMF official, August 2005.
60. DFID, Eliminating World Poverty: A Challenge for the 21st Century, London: Department for International Development, 1997, p 39.
61. The final report was published in March 2000. A Meltzer, Report of the International Financial Institutions Advisory Commission, Washington, DC: US House of Representatives, 2000.
62. Interview with Edwin M Truman, former Treasury Assistant Secretary, International Affairs, 31 October 2006.
63. L Summers, Post-G7 press conference, 25 September 1999, US Department of Treasury, at http://www.treas.gov/press/releases/ls140.htm, accessed 12 May 2006
64. Summers, 'The right kind of IMF for a stable global financial system', remarks to the London School of Business, 14 December 1999, at http://www.treas.gov/press/releases/ls294.htm, accessed 12 May 2006
65. and Summers, 'Transcript: Treasury's Summers post-G7 press conference', 25 September 2000, US Department of Treasury.
66. J Taylor, 'International financial crises: What is the role for government?', Remarks at the Cato Institute's 20th Annual Monetary Conference, 17 October 2002, at http://www.treas.gov/press/releases/ po3546.htm, accessed 12 May 2006
67. and US Department of Treasury, Report on Implementation of the Recommendations made by the International Financial Institutions Advisory Commission, Washington, DC: US Department of Treasury, 2001.
68. It is important to note, however, that US, British and Fund objectives in calling for reforming the Fund - and, ultimately, their very interpretation of what 'streamlining' conditionality meant - were often different. The Americans, for example, were comfortable with retaining the ex-ante controls that others sought to reduce.
69. Summers, The Right Kind of IMF.
70. IMF, Guidelines on Conditionality;
71. IMF, Statement of the IMF Staff;
72. and IMF, Operational Guidance to IMF Staff on the 2002 Conditionality Guidelines, Washington, DC: International Monetary Fund, 2006.
73. Of course, the question of the relationship between participation and legitimacy is itself a complex one, raising questions regarding whose participation is necessary for a legitimate process.
74. J Boughton & A Mourmouras, 'Is policy ownership an operational concept?', IMF Working Paper WP/ 02/72, 2002, p 3.
75. For staff discussions of this problem, see IMF, Review of Conditionality Guidelines - Selected Issues, 4 March 2005, at http://www.imf.org/external/np/pp/eng/2005/030405.pdf, accessed 27 July 2005
76. IMF, Statement of the IMF Staff;
77. and IMF, Operational Guidance.
78. See also G Bird & TWillett, 'IMF conditionality, implementation and the new political economy of ownership', Comparative Economic Studies, 46, 2004, pp 423-450.
79. Interview with senior IMF official, August 2005.
80. Taylor, 'International financial crises'. In fact, the National Security Strategy suggests that the IMF may ultimately become redundant once markets take up their proper role in fostering international stability and domestic development. US National Security Council, The National Security Strategy of the United States of America, Washington, DC: US National Security Council, 2006.
81. IMF, Evaluation of the IMF's Role in Poverty Reduction Strategy Papers and the Poverty Reduction and Growth Facility,Washington, DC: Independent Evaluation Office of the International Monetary Fund, 2004, p 3.
82. For some excellent discussions of the politics of the IMF's institutional culture, see B Momani, 'Limits on streamlining Fund conditionality: The International Monetary Fund's organizational culture', Journal of International Relations and Development, 8, 2005, pp 142-163;
83. and Momani, 'Recruiting and diversifying IMF technocrats', Global Society, 19 (2), 2005, pp 167-187.
84. Interview with senior IMF offcial, 31 August 2005.
85. Interview with Jack Boorman, 31 August 2005.
86. Interview with former member of the IMF Executive Board, 29 August 2005.
87. This solution is also constrained by the Fund's recent financial difficulties, which have led De Rato to propose new funding arrangements for technical assistance, including the possibility of charging fees. De Rato, The Managing Director's Report on Implementing the Fund's Medium-Term Strategy, p 11.
88. Best, The Limits of Transparency.
89. Interview with Aldo Caliari, Director, Rethinking Bretton Woods Project, Center of Concern, 31 August 2005.