The International Monetary Fund in the Global Economy
Banks, Bonds, and Bailouts

Explains the policies and decisions of the International Monetary Fund (IMF) in the context of changes in the global economy.

Mark S. Copelovitch (Author)

9780521143585, Cambridge University Press

Paperback, published 10 June 2010

394 pages, 2 b/w illus. 16 tables
22.8 x 15.2 x 1.8 cm, 0.64 kg

'This book represents a major contribution to the growing literature on the IMF and, more generally, to the understanding of the political economy of international organizations. Using an original 'common agency' perspective, Mark Copelovitch presents an innovative way to address decision-making at the international financial institutions, which is driven both by the major shareholder governments and by the bureaucratic staff of these organizations. Copelovitch shows that both the intensity and the heterogeneity of the preferences of the IMF's major shareholders determine whether a country will receive favorable treatment from the institution. The book furthermore shows that the nature of IMF lending has changed because of major historical shifts in patterns of international financing from concentrated sovereign bank lending to decentralized portfolio investment and bank lending to the private sector. The greater collective action problems generated by these new forms of international finance force the IMF to make larger loans with more extensive conditionality in order to reassure global markets. Copelovitch substantiates his theoretical claims with both sophisticated statistical analysis and detailed case studies. This is a must-read for both scholars of international political economy and policy-makers interested in the IMF's evolving role in the global financial system.' James Raymond Vreeland, Georgetown University and author of The IMF and Economic Development

The explosive growth and increasing complexity of global financial markets are defining characteristics of the contemporary world economy. Unfortunately, financial globalization has been accompanied by a marked increase in the frequency and severity of financial crises. The International Monetary Fund (IMF) has taken a central role in managing these crises through its loans to developing countries. Despite extensive analysis and criticism of the IMF in recent years, key questions remain unanswered. Why does the Fund treat some countries more generously than others? To what extent is IMF lending driven by political factors rather than economic concerns? In whose interests does the IMF act? In this book, Mark Copelovitch offers novel answers to these questions. Combining statistical analysis with detailed case studies, he demonstrates how the politics and policies of the IMF have evolved over the last three decades in response to fundamental changes in the composition of international capital flows.

1. The International Monetary Fund in the global economy
2. Global finance and the politics of IMF lending: theory
3. Global finance and the politics of IMF lending: evidence
4. Global finance and IMF lending to Mexico, 1983–1995
5. Global finance and IMF lending to South Korea, 1983–1997
6. Conclusions.

Subject Areas: Political economy [KCP], Development economics & emerging economies [KCM], Monetary economics [KCBM], Economics, finance, business & management [K], International relations [JPS], Development studies [GTF]