Imf and Its Role in International Political Economy
IMF and its role in International Political Economy
Political economy is not a new word for us because of the close relationships between politics and the economy. The development in politics is due to the development in society and the development in society is mostly driven by the economy. The parallel existence and mutual interaction of ‘state’ and ‘market’ in the modern world creates ‘political economy’; without both state and market there could be no political economy (Gilpin, 2003, P9). Market allocates resources to a particular group, class or region where conditions are most favorable. As a consequence, market economies result in the uneven development both domestically and internationally. As our issue is about international political economy, the connection is the uneven development in different economic systems of nations lead to the uneven status of countries around the world. The struggle among groups and states over the distribution of benefits and costs has become a major feature of international relations in the modern world (Gilpin, 2003, P21, par.2). It is sure that market or economy has a big influence on sovereign states. The changing market is very likely to change states. So the economy is crucial for a country, in a globalizing world with vast of interactivities among countries, to get a place. As a part of globalization, the globalization of finance, arguing that it has fundamentally altered the traditional monetary relationship between states and markets, ultimately undermines national monetary sovereignty (Cohen, 2003, P215).
Because of the importance of finance in globalization and in the world political economy, organizations are needed to be a ‘middle man’ among the financial interactivities of countries. The International Monetary Funds (IMF) is a very good example.
In July1944, the IMF, a multilateral institution, was created at the Bretton Woods conference. This institution was designed to provide stability to trade and monetary
Political economy is not a new word for us because of the close relationships between politics and the economy. The development in politics is due to the development in society and the development in society is mostly driven by the economy. The parallel existence and mutual interaction of ‘state’ and ‘market’ in the modern world creates ‘political economy’; without both state and market there could be no political economy (Gilpin, 2003, P9). Market allocates resources to a particular group, class or region where conditions are most favorable. As a consequence, market economies result in the uneven development both domestically and internationally. As our issue is about international political economy, the connection is the uneven development in different economic systems of nations lead to the uneven status of countries around the world. The struggle among groups and states over the distribution of benefits and costs has become a major feature of international relations in the modern world (Gilpin, 2003, P21, par.2). It is sure that market or economy has a big influence on sovereign states. The changing market is very likely to change states. So the economy is crucial for a country, in a globalizing world with vast of interactivities among countries, to get a place. As a part of globalization, the globalization of finance, arguing that it has fundamentally altered the traditional monetary relationship between states and markets, ultimately undermines national monetary sovereignty (Cohen, 2003, P215).
Because of the importance of finance in globalization and in the world political economy, organizations are needed to be a ‘middle man’ among the financial interactivities of countries. The International Monetary Funds (IMF) is a very good example.
In July1944, the IMF, a multilateral institution, was created at the Bretton Woods conference. This institution was designed to provide stability to trade and monetary
References: 1. Barro, Robert J. (June 2001). Economic Growth in East Asia Before and After the Financial Crisis. National Bureau of Economic Research. Retrieved April 19 ,2008 from, <http://www.nber.org/papers/w8330> 2 3. Dash, Kishore C. (2003). International Political Economy. Part2, International Monetary Relations. Lynne Rienner Publishers, Inc. Colorado. 4. Gilpin, Robert. (2003). International Political Economy. Part1, Contending views of International Political Economy. Lynne Rienner Publishers, Inc. Colorado. 5. Goddard, C. Roe. (2003). International Political Economy. Part2, International Monetary Relations. Lynne Rienner Publishers, Inc. Colorado. 6. International Monetary Fund: The Role of the IMF and IMF History. Cool Fire Technology. Retrieved April 26, 2008 from, <http://www.cftech.com/BrainBank/FINANCE/IMFHistory.html.> 7. IMF staff. (June 2000). Recovery from the Asian Crisis and the Role of the IMF. International Monetary Funds. Retrieved April 27, 2008 from, < http://www.imf.org/external/np/exr/ib/2000/062300.htm#III > 8. Krueger, Anne. (June3 2004). Promoting International Financial Stability: the IMF at 60. Retrieved April 12, 2008 from, <http://www.cftech.com/BrainBank/FINANCE/IMFHistory.html>