Tuesday, November 4, 2008

Cool idea about the Fund

Here is Eswar Prasad: The second idea is to impose conditions on voting rights, rather than just on loans. Each country would get a list of criteria (e.g., a lower budget deficit, a more flexible exchange rate) that it would have to fulfil or have a plan for making progress towards. The IMF already jawbones its member countries, but only countries that borrow from it take its recommendations seriously....Conditionality on voting rights might make the IMF uniformly despised, but that is a price worth paying for being seen as an impartial institution that doesn’t just pick on emerging markets and small countries.
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