Roles of the IMF
Barry Eichengreen, a professor of economics at the University of California, Berkeley speculates about the role of the IMF. This is a good summary to help clarify the role of the IMF in the pantheon of international organizations.What is the IMF’s Mission?
The International Monetary Fund has been one of the few beneficiaries of the global economic crisis. Just two years ago, it was being downsized, and serious people were asking whether it should be closed down. Since then, there has been a renewed demand for IMF lending...
The IMF’s first role is to assist countries that, as a result of domestic policies, experience balance-of-payments crises...
A second role for the IMF is to act as a global reserve pool...
A third role for the IMF is macro-prudential supervisor. Recent events have made clear that someone needs to anticipate and warn of risks to global financial stability...
[T]he IMF’s fourth role, namely using its bully pulpit to warn of risks created by large-country policies. Small countries are subject to market discipline, as any Latvian will tell you. But when large economies whose currencies are used internationally need more resources, they can just print more money. Not only do they feel less market discipline, but they are subject to less IMF discipline, since they are not compelled to borrow from the Fund...
Finally, the IMF needs to coordinate reform of the international system...
Find out What You Need to Know
Labels: economics, International Organizations, sovereignty
posted by Ken Wedding @ 5:55 AM
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