POLS 2080 Lecture Notes - Lecture 12: Washington Consensus, Loanable Funds, Free Trade
27 Nov 2015
School
Department
Course
Professor
Document Summary
Us was looking for something that would guarantee econ benefit. What came out of it was these 2 institutions. Original purpose: provide short-term loans to solve temporary balance-of- payments problems (when importing a lot more than they are exporting) Imf steps in and helps them get back to speed". Member"s states pay quotas" to form a pool of loanable funds the size of your quota determines your voting power in the imf. A membership fee, which depends on your own wealth (poor countries pay less) This is a pool of money, loanable fund. Original purpose: provide longer-term financial help for post-war reconstruction ansd development projects (poor country wanting to create a new highway ) International bank for reconstruction and development was original name. Meant to offer loans to middle-income countries for these projects. Turns out banks were giving out a lot of loans and many countries could not deal with it.
