@article{Rafferty2018,
title = {The IMF’s “New” Institutional View: An Unwitting Trojan Horse for International Financial Fragility },
author = {Devin T Rafferty},
url = {http://globalsummitry.wpengine.com/wp-content/uploads/2020/06/GSP-4.1.4.pdf},
doi = {https://doi.org/10.1093/global/guy005},
issn = { 2058-7449},
year = {2018},
date = {2018-00-00},
journal = {Global Summitry},
volume = {4},
number = {1},
pages = {50-63},
abstract = {In the aftermath of the Great Financial Crisis (GFC), it became widely accepted that loosely regulated international capital flows were responsible for transmitting the crisis from the developed to the developing world. As a result, using capital controls to manage them came into vogue with many groups. The International Monetary Fund (IMF) was one such actor, and its revamped policy proposals became encapsulated as its “New” Institutional View. It was here the Fund officially recognized the efficacy of controls for countering international financial fragility and stated the exact conditions under which they were acceptable. However, it also designated that authorities should retain a heavy preference for using “market-based” adjustment measures to correct capital flow-induced macroeconomic imbalances, even going as far as to mandate specific correctional paths and sequences for common individual scenarios, which indirectly relegated capital controls to secondary importance. This article argues these proposed adjustment measures are procyclical and hence the “New” Institutional View increases international financial fragility and impedes economic development. To do so, we combine Albert Hirschman’s vision of a development process with Hyman Minsky’s take on international financial instability to demonstrate this “View” is discordant with the challenges developing economies face.

},
note = {Article},
keywords = {Brady Bonds, Development, East Asian Financial Crisis, Economic Crisis, Economy, Financial Fragility, Financial Stability, IMF, Interest Rates, International Monetary Fund, Latin American Debt Crisis, Mexican Debt Crisis},
pubstate = {published},
tppubtype = {article}
}