Expanding the International Monetary Order after the Cold War

Abstract

One of the most important changes in the IMF’s international role since the organization was created has been the gradual expansion of its activities beyond short-term balance of payments financing to encompass the diffusion of global normative standards for national economic governance. It is here that the IMF engages in repeated strategic games over policy efficacy with its member states, which center on the politics of economic ideas and — in borrowing states — the use of material incentives to create openings for intellectual persuasion. This role is carried out primarily by the Fund staff, who are the main conduit for the diffusion of economic reform ideas between the IMF and national policymakers, and whose intellectual legwork on ‘best practice’ economic policy norms inside the organization shapes the parameters of the IMF’s advice to its member states.