Why the IMF Needs a Reset
GOVT: 419
Global Governance
Research Paper (Rough Draft)
Word Count:
Why The IMF Needs A Reset
An analysis on the division between today’s emerging and developed markets post 2008 financial crisis, and the role the IMF must play in developing an effective strategy for global economic governance.
Today the global economy slowly continues to recover from the events of the 2008 financial crisis, one of the most severe depressions in modern economic history. Due to the byproduct of thicker degrees of globalization, every player in today’s global economy was financially affected. As markets crashed, countries across the world wondered how this disaster could have occurred. Little did they know, financial institutions across the world, primarily the International Monetary Fund (IMF), warned the largest players within the global economy of the impending financial crisis. Years of irresponsible fiscal policies brought on by an onslaught of liberalization, lack of institutional transparency, and mass privatization led by the worlds most economically developed states had brought the global financial system to it’s knees. Why would the IMF allow this to go on despite the foreseeable outcomes? Here in lies the problem. Created in 1945, the IMF was designed to be the worlds premiere form of economic governance. Its role is to safeguard the global financial system and while working with its member countries, strive towards stable economic development in regions and countries that need it most. The financial institution is comprised of 188 member countries, with developed states such as the U.S. in power of the majority of institutional power. Despite being the owner of the world’s largest economy, other countries such as China, India, Brazil, Russia and many other emerging markets (EM) now rival or have surpassed developed economies in terms of economic size and growth. With increased economic
Global Governance
Research Paper (Rough Draft)
Word Count:
Why The IMF Needs A Reset
An analysis on the division between today’s emerging and developed markets post 2008 financial crisis, and the role the IMF must play in developing an effective strategy for global economic governance.
Today the global economy slowly continues to recover from the events of the 2008 financial crisis, one of the most severe depressions in modern economic history. Due to the byproduct of thicker degrees of globalization, every player in today’s global economy was financially affected. As markets crashed, countries across the world wondered how this disaster could have occurred. Little did they know, financial institutions across the world, primarily the International Monetary Fund (IMF), warned the largest players within the global economy of the impending financial crisis. Years of irresponsible fiscal policies brought on by an onslaught of liberalization, lack of institutional transparency, and mass privatization led by the worlds most economically developed states had brought the global financial system to it’s knees. Why would the IMF allow this to go on despite the foreseeable outcomes? Here in lies the problem. Created in 1945, the IMF was designed to be the worlds premiere form of economic governance. Its role is to safeguard the global financial system and while working with its member countries, strive towards stable economic development in regions and countries that need it most. The financial institution is comprised of 188 member countries, with developed states such as the U.S. in power of the majority of institutional power. Despite being the owner of the world’s largest economy, other countries such as China, India, Brazil, Russia and many other emerging markets (EM) now rival or have surpassed developed economies in terms of economic size and growth. With increased economic