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SOCI 307 (17)
Lecture 6

Lecture 6- Bretton Woods, IMF, and the World Bank.pdf

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Sociology (Arts)
SOCI 307
Zygmunt Mochnacki

The Bretton Woods Systemchallenge of postwar reconstruction and rebuilding international capitalismlegitimate intervention in economy for human welfarecorrect market failure but through an open systemembedded liberalism vs classical liberal regimeembedded still liberal towards capitalism and free markets but it distinguished itself from the classical regime by permitting some means for the state to ensure human welfare institutionalize responsibilities in intl monetary system while ensure govts autonomy over domestic economiescreate a system where there is some responsibility and faith in intl eco order while keep autonomy of domestic eco in govt hands IMF World Bank GATT later WTOprocess to watch transformation of organizations ideas and ruleswhat are the causeswhat are the outcomes for relative power of nationstates Bretton Woods held at Mount Washington Hotel Bretton Woods NH 1944 Two Powers Two ConceptionsBritish John Maynard Keynesno reliance on single national currency global bank with its own currency International Clearing Unionpurpose to clear the balance of trade among nations to keep it equitableredistribution method countries with high BOP pay higher interest rates instrument for longterm eco development through longterm loans and mediumtolong term projects things the World Bank took ontrade monetary and fiscal policy no policy conditions on loans and emergency transfers automatic when a country reaches a certain balance of payment crisisshared responsibility for stability and reconstruction among creditordebtorsgoal promoting global balance of trade and redistribution as basis for stabilityAmerican Harry Dexter Whitemore limited conception of organization and mandatejust one basic institution to handle BOP crises special status for US as the world unit of accounttaking the place of the pound sterling prior to WWI debtor nations responsible for the payback of loans emergency transfers on a discretionary basis conditions on loans monetarist focus on controlling inflation and price stability in crisesresponsibility for stability rested on debtor nations goal for US intl monetary stability as lynchpin for expanding into new markets ensure natl political autonomy and dominant intl power Outcomes of Bretton WoodsAmericans proposal succeeds US gold standard no ICUIMF and World Bankyet conditionality not ascribed to mandateAmericans wanted conditionality didnt get it Keynesian ideas institutionalized at intl levelIMF dedicated to the expansion and balanced growth of intl trade and to contribute thereby to promotion of high levels of employment and real income and to the development of the productive resources of all members as primary objectives of eco policy IMF Articles of Agreement 12institutionalized eco development as core valueeven though US only wanted it as a shortterm solution agency institutionalized US commitment to intl systeminstitutionalized new class of intl civil servants civil servants who work for these institutions whose agendas are set by these institutions rather than their particular governments Bretton Woods OrganizationsIntl Monetary Fund IMFThe Worl
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