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Volume 28, Issue 2, Apr2015
1. Title: Recalibrating Policy Orthodoxy: The IMF since the Great Recession.
Authors: Ban, Cornel, Gallagher, Kevin.
Abstract: This special issue reviews patterns of policy stability and change at the International Monetary Fund (IMF) since the Great Recession and attempts to explain their causes. The contributors show that the crisis ignited a reassessment regarding how the IMF would position itself as a pivotal player in global economic governance. Some new ideas and evidence definitely found their way into IMF decision making, but this process was often tempered by the nature of the institution and the powerful interests that control its governing structure. Where change did occur, its causal generators could be found in some combination between IMF staff politics, a string of innovations coming from academic and IMF economists, and the emerging economic powers' creative leveraging of institutional fora both within and inside the Fund.
2. Title: Back to Basics: The Great Recession and the Narrowing of IMF Policy Advice.
Authors: Broome, André.
Abstract: This article contributes to the literature on the dynamics of change and continuity in the International Monetary Fund's (IMF’s) policy paradigm. The IMF embarked on a process of 'streamlining conditionality' during the 2000s, but many observers have argued that the IMF's policy paradigm from the 1990s remains intact. This article examines whether the scope of the IMF's policy advice to borrowers during the Great Recession narrowed in comparison to its advice to borrowers during the heyday of the Washington consensus in the 1980s and 1990s. The article uses qualitative content analysis to establish the frequency of a series of policy dialogue indicators in four sample sets of countries requesting IMF stand-by arrangements over three decades. The evidence suggests that contemporary IMF policy advice to borrowers continues to stress the importance of fiscal consolidation, with reduced emphasis on promoting the structural economic reforms associated with the Washington consensus era.
3. Title: Austerity versus Stimulus? Understanding Fiscal Policy Change at the International Monetary Fund since the Great Recession.
Authors: Ban, Cornel.
Abstract: Since 2008, the International Monetary Fund (IMF) has become more open to the use of discretionary fiscal stimulus packages to deal with recessions, while changing its doctrine on the timing and content of fiscal consolidation. The article traces this evolution of the Fund's doctrine to staff politics, more diverse thinking in mainstream economics, and a careful framing of the message through the use of mainstream macroeconomic models. To map the changing contours of institutional views on fiscal policy through 2008-2013, the article undertakes a detailed content analysis of official publications from the Fiscal Affairs Department and the Research Department. The connection between these shifts and significant personnel shake-ups is demonstrated through an extensive biographical analysis of the authors of all IMF studies cited in the official reports of the two departments. The findings contribute to the emerging debate on the sources of intellectual and policy change in international economic organizations.
4. Title: Contesting the Governance of Capital Flows at the IMF.
Authors: Gallagher, Kevin P.
Abstract: Financial crises can trigger different actors to reassess their ideas, interests, and policies, and sometimes change them. The Global Financial Crisis triggered a reassessment at the International Monetary Fund (IMF) regarding the utility of capital account liberalization and the management of capital flows. In 2010, the IMF embarked upon an official reassessment of these issues and in 2012 published an official 'institutional view' on capital account liberalization and managing capital flows that gives more caution toward capital account liberalization and endorses the use of capital controls in certain circumstances. This article traces the political process that yielded the IMF's new view and draws out lessons for thinking about policy change in global economic governance institutions.
5. Title: The IMF's Rethink of Global Banks: Critical in Theory, Orthodox in Practice
Authors: Gabor, Daniela
Abstract: The International Monetary Fund's (IMF) new financial interconnectedness agenda, developed in response to postcrisis calls from G20 to better understand systemic financial institutions, deploys a critical approach that stresses the spatial, political, and institutional dimensions of cross-border financial networks. It portrays global banks as key nodes in those networks, 'super-spreaders' of systemic risk through complex business models that involve yield search, regulatory and tax arbitrage. Yet this critical view does not translate into its policy advice at country level. In regular surveillance of developing countries, the IMF remains committed to a benign view of transnational banking, even when confronted with growing cross-border fragilities. During crises of cross-border banking, the IMF tailors its conditionality to minimize domestic regulatory challenges to cross-border banking models and to propose crisis measures that create new profit opportunities for transnational banks.
6. Title: Banking on Seniority: The IMF and the Sovereign's Creditors.
Authors: Erce, Aitor.
Abstract: The programs designed by the International Monetary Fund (IMF) during the Global Financial Crisis have shown more awareness of the importance of domestic demand for the prospects of economic recovery. Yet the IMF has continued to do little about the late payments made by governments to domestic creditors and suppliers. In contrast, the greater protection historically awarded by the IMF to foreign creditors has endured throughout the recent crisis. The article suggests that, in order to adequately balance foreign creditor seniority and growth objectives, the IMF may sometimes need to emphasize equitable burden-sharing across categories of creditors rather than privilege the interests of international bond markets.
7. Title: Professional Skills in International Financial Surveillance: Assessing Change in IMF Policy Teams
Authors: Seabrooke, Leonard, Nilsson, Emelie Rebecca.
Abstract: In 2006, the International Monetary Fund's (IMF) Financial Sector Assessment Program (FSAP) lauded Iceland's capacity to 'withstand extreme, but plausible, shocks,' which was clearly an error in judgment. After the international financial crisis hit, IMF officials bemoaned the lack of professional market skills in FSAP teams. Importing these skills was difficult given IMF staff freezes, but postcrisis FSAP continued with heightened legitimacy inside and outside the IMF. This article provides an assessment of FSAP teams, focusing on the hiring of external experts and their professional skills. We use an Optimal Matching analysis of work roles in career histories to identify differences in policy teams and external experts' attributes. The article also draws on interviews with FSAP team members from 2008 to 2013. We demonstrate that changes in professional skills and team composition are a consequence of demands for professional insulation, institutional legitimation, and a view of professionalism as transnational organizational competence.
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