The IMF returns

Allan H. Meltzer

Received: 31 May 2010 /Revised: 1 September 2010 /Accepted: 2 September 2010 /Published online: 18 September 2010# Springer Science+Business Media, LLC 2010

Abstract The IMF’s role in world financial markets increased following the creditand housing market crises. One good change was the acceptance of a proposal madeby the Meltzer Commission to adopt a “flexible credit line” that grants responsibleborrowers a line of credit to use in emergencies. Some mistaken changes gave theIMF a large increase in lending resources, relaxed the requirements for reformimposed on borrowers, and increased loans to risky borrowers such as Ukraine.Borrowing should be used to prevent the spread of financial crises, not to bailoutimprudent borrowers that mismanage their economy.

Keywords Global Financial Crisis . IMF

JEL codes F53 . O19 . F35

1 Introduction

It was like a scene from a bad movie. To cheers, the International Monetary Fund(IMF) and the European Union rode in to rescue the Euro, Europe, and Greece intime for the market opening on Monday. Alas, the IMF’s analysis was wrong, andthe rescue did not occur. By Tuesday, markets saw that the analysis was flawed, themain problems remained, and the IMF and EU loans would not solve the problemsin Greece, Portugal and Spain.

Public sector wages in Greece are far above productivity (Meghir et al. 2010).IMF and EU loans do nothing to change that fact. When Greece joined the EuropeanCentral Bank (ECB), it abandoned its domestic money. In a fixed exchange ratesystem, the solution for wage rates above productivity are either lower wages or, less

Rev Int Organ (2011) 6:443–452DOI 10.1007/s11558-010-9097-y

A. H. Meltzer (*)Carnegie Mellon University, Pittsburgh, PA, USAe-mail: am05@andrew.cmu.edu

A. H. MeltzerThe American Enterprise Institute, Washington, DC, USA

likely, emigration. When Greece joined the ECB, it also accepted a rule for fiscaldiscipline that restricted budget deficits to 3% of GDP. Greece’s deficit reachedalmost 14% of GDP. New loans can delay fiscal adjustment, but they add to the debt.New loans prevented a current default on Greek debt, but increased the excessivedebt. Holders of Greek debt now find their claims made subsidiary to IMF and EUloans. The prospects for a haircut increase.

Greece has a large, informal private sector. Wages and incomes adjust downwardrapidly as demand falls. The problem is in the very large state sector, whereorganized workers resist downward adjustment. The IMF and the EU did not requirethe Greek government to sell state-owned firms and use the proceeds to retire debt.Restoring firms to the private sector facilitates wage adjustment. Asset sales and debtreduction was the proper policy. If asset sales did not reduce outstanding debtsufficiently, default in the form of debt restructuring would be required.

Why is the IMF part of the Greek loan? Greece is part of a monetary union, justas California is part of the dollar system. Should the IMF lend to California? Greeceis, and California is not, an IMF member. But the main reason for IMF involvementis that it shifts some of the costs to the United States, Canada, the U.K., China, Japanand other IMF members.

I dwell on the Greek crisis because it shows much of what is wrong with the IMF.It avoided privatizing and selling assets, and it provided no means of assuring thatthe Greek government would fulfill its budget promises. Markets are properlyskeptical of promises about the next three years made under current circumstancesand in the face of strong and strident demands from public sector employees.

In 2003 the IMF’s Independent Evaluation Office issued a report on fiscaladjustment in countries operating under IMF programs (IMF 2003). The reportfound that countries often fail to follow commitments made in the loan negotiation.The explanation: countries are unwilling or politically unable to make many of therequired structural adjustments. The report recognizes that most fiscal reformprograms do not last into the second year.

The Independent Evaluation report also recognizes the main reason for failure toreform. Reform occurs where there is strong leadership of a political faction thatfavors reform. Europeans or Americans need not look beyond their own countries tounderstand the political dynamics that make reform difficult. IMF exhortationwithout strong domestic support will not succeed (Vreeland 2006; Dreher 2009).Mexico, Peru, Chile and Brazil are examples of countries where, after many falsestarts, local support for reform reduced fiscal deficits and inflation.

2 The New IMF

Before the credit and housing crisis exploded in 2007, the IMF had become a muchsmaller and less important institution. Most of its borrowers had repaid their debt, soIMF loans had fallen from a peak of about SDR 65 billion in 2004 to less than SDR10 billion in 2007 (IMF 2007). At that point, IMF budget outlays had to be reduced.The IMF discussed gold sales to pay for expenditures (IMF 2008). Several of itsformer clients had adopted stabilizing policies. Asian countries had accumulatedabout US $4 billion in foreign exchange holdings to protect against sudden

444 A. H. Meltzer

economic shocks. The Chiang-Mai initiative established a US $120 billion fund toassist Asian countries, if a crisis returned. The purpose was to avoid recourse to IMFloans and crisis management. Even Turkey, one of the IMF’s frequent borrowersannounced publicly in the fall of 2009 that it preferred to manage without IMFsupport and interference. Throughout the world, the IMF was seen as a surrogate forpolicies the United States espoused but did not practice at home. Many argue that themajor shareholders exercise their power to pursue international political goals. Whilethe Board certainly must contend with the Fund’s internal rules, and all studies of thedeterminants of IMF lending show that economic variables guide IMF lending, agrowing body of literature indicates that international politics matter as well.1

Argentina made the largest debt default that had ever occurred. Holders ofArgentina bonds included many individuals in Europe and Japan as well as financialinstitutions, especially emerging market funds. The large number and widelydispersed creditors made settlement difficult. The IMF had no role. The marketarranged a settlement acceptable to 75% of the creditors that was mainly the work ofAdam Lerrick who organized the individual creditors and negotiated with theArgentine government (Cooper and Momani 2005). This experience suggests that,without official interference, market solutions can work.

At about the same time, borrowers were encouraged to include collective actionclauses that make settlement of defaults and debt restructuring easier. Again, theIMF remained sidelined. The energy behind collective action clauses came fromJohn Taylor, U.S. Treasury Undersecretary at the time.

The debt settlement and the successful introduction of collective action clausesdiminished the IMF’s role as the agency responsible for managing international debtproblems. When IMF Managing Director Strauss-Kahn repeated “the IMF is back,”after the London Summit of 2008, he acknowledged that the IMF’s role haddiminished (IMF 2009).

The crisis revived the IMF. At the London meeting in 2008, countries voted toincrease IMF resources by US $500 billion. Much of the increase had been agreedbefore the meeting. Countries also voted to issue US $280 billion in new SDRs.Since the IMF issues SDRs in proportion to country’s quotas, more than two-thirdsof the additional SDRs will go to rich countries. Impoverished countries willexchange their SDRs for currencies they can spend. Since Zimbabwe, Iran, Sudanand Venezuela are members of the IMF, they, too, will receive an allocation ofSDRs.

Actual lending gives a different picture of IMF activity during the financial crisis.Between the end of 2007 and April 2010, the IMF increased loans outstanding bySDR 35 billion, about US $57 billion at the current exchange rate. In 2009, theIMF issued SDR 280 billion, the full US dollar amount agreed in London.

The new IMF made fewer demands on borrowers. Critics of its Asia policy in1997–98 and new management changed procedures. It offered stand-by agreementsfor countries with conservative fiscal and monetary policy (“Flexible Credit Line”),

1 See Steinwand and Stone (2008) for a recent review. For in depth consideration of international politicalfactors, see Thacker (1999), Stone (2002, 2004), Dreher and Jensen (2007), McKeown (2009), Dreher etal. (2009).

The IMF returns 445

as the Meltzer Commission recommended in 2000 (Meltzer 2006). Mexico becamethe first country to agree to supplement domestic reserves with the right to draw upto US $47 billion from the IMF.

The IMF used its expanded resources to make loans to countries that hadborrowed and spent excessively. One of the worst examples is US $16.6 billion lentto Ukraine, a country with an unstable government and a very divided electorate.After its recent election, Ukraine’s new government increased public sector wagesand pensions by 20 percent. The IMFs response: it reduced Ukraine’s requiredholding of international reserves.

Other large loans to countries with poor prospects include Hungary, wheregovernment spends 50 percent of GDP mainly to pay interest and finance currentconsumption. The budget remains in deficit and the economy continues to decline.Romania has a US $17 billion IMF loan, a projected budget deficit of 9 percent ofGDP, and worsening economic prospects because of European turmoil. Thegovernment announced additional spending cuts including a 25 percent reductionin public sector wages that was met by strikes and demonstrations.

The IMF also has a large (US $10.9 billion) loan to Pakistan outstanding. This,too, seems a risky undertaking given the inability of Pakistanis to form a strong,democratic government and the political instability in the western regions. But it isprobably less risky than the US $800 million in credit to Zimbabwe that it offeredjointly with the African Export-Import Bank. The 2010 loan to Greece is part of apackage of risky loans with weak restrictions on government budgets. In Romania,the new IMF favored less spending reduction than the government because of itsconcern for the poor and disadvantaged.

Unlike the old IMF that many criticized for being unconcerned about the effect ofausterity on low income individuals, the new IMF puts much greater emphasis onthe effects of policy on income distribution. It has not spoken about whether suchconcerns are compatible with the program for restoring macroeconomics stability. Itis costly to tax the poor or reduce transfers, but there is possibly a larger loss if taxesfall more heavily on investment.

Since the IMF has a poor record of enforcing its fiscal and monetary restrictions(Vreeland 2006), there may be little difference in outcomes. Elected governments,and some authoritarian regimes as well, usually choose policies that the public willaccept. Stabilization policies seem to work best, if they work relatively quickly.Long drawn out austerity programs are unlikely to succeed.

The old IMF urged countries to avoid devaluation by raising nominal and realinterest rates. The new IMF accepts currency depreciation and avoids large increasesin interest rates. The old IMF preached budget balance and fiscal restraint. The newIMF is eager to endorse government spending to help the poor. To carry out its newprograms, the IMF has expanded its authorized spending, but actual spendingincreased by US $51 billion during the crisis, a small part of the mandated increasein IMF resources.

Unfortunately, one critical part of IMF policy operations has not changed. TheIMF has always combined large loans with poorly enforced promises to reform(Vreeland 2006). That hasn’t changed. Despite internal research showing that mostpromises are kept for a year or less (IMF 2003), the IMF has not found an ability tosanction countries that violate agreements. At times, the IMF has withdrawn funding

446 A. H. Meltzer

for a short period, but governments know from experience that the withdrawal istemporary.2

In the mid-1970s, members amended the IMFAgreement to recognize that the eraof fixed but adjustable exchange rates ended in 1973. Fluctuating exchange rateswere accepted as an authorized approach. The IMF’s responsibility shifted frommaintaining fixed exchange rates to surveillance of members’ exchange rate policiesto assure that members did not manipulate exchange rates for their own benefit.

The IMF failed completely to carry out the assignment. Beginning with Japan,countries chose export-led growth as a development strategy. Combining anundervalued exchange rate and rigid exchange controls permitted countries to runpersistent current account surpluses, import capital to finance development andprevent exchange rate appreciation. China followed this strategy to an excessivedegree. It accumulated US $2 trillion of foreign reserves by 2010.

The United States could get Japan to appreciate its currency from 360 yen perdollar at the end of the fixed exchange rate period to less than 100 yen per dollar by2010. Neither the IMF nor the United States convinced China to appreciate. There isnot much evidence that the IMF had the will or the tools to change China’s policy.

No one in authority ever wonders publicly why countries like Turkey, Pakistan,Argentina, and Ecuador and, earlier Mexico and India had frequent recourse to IMFprograms and loans. Could the reason be that these countries did not reform(Easterly 2005)? It is instructive that Turkey began implementing reforms more fullywhen it had the incentive of possible membership in the European Union. Withoutreforms, Turkey would have no chance of membership. India’s incentive came whenit compared its growth rate to China’s. Reforms that had been politically impossiblecould be and were made. India’s growth rate rose.

3 The SDR as International Money

The Chinese government proposed to change the role of the US dollar as aninternational money by proposing that the IMF replace the United States and theSDR replace the dollar (Carbaugh and Hedrick 2009). While problems with thedollar as an international money are of long standing, the SDR is not a plausiblesubstitute for the dollar.

The SDR is a unit of account used only at the IMF to value its accounts. It lacksthe essential property of money-use as a medium of exchange. The IMF describesthe SDR as a reserve asset. On its website (IMF 2010), the IMF writes:

“The SDR is neither a currency nor a claim on the IMF. Rather, it is a potentialclaim on the freely useable currencies of IMF members.”

The SDR began existence in 1969 as a supplement to gold as a reserve asset onthe mistaken belief that growth of world trade would be hindered by slow growth of

2 In April 2010, a vice-president of the Czech National Bank told a Czech newspaper that the IMF issuedfalse information about the problems in the Czech financial system. “It is difficult to be certain ... that theIMF wanted to harm the Czechs, Slovaks or Poles on purpose. ... More likely it was a combination ofpanic, lack of expertise, and a desire to see problems everywhere.”

The IMF returns 447

gold and dollars. This did not happen, so after an initial allocation, the SDR had norole in subsequent events. The initial issue of SDR 9.3 billion in 1970–72 wasfollowed by SDR 12.1 billion in 1979–81 and SDR 16.1 billion in 2009.

Initially the SDR was valued at the equivalent of US $1 dollar in gold. After theBretton Woods system of fixed exchange rates ended in 1973, the SDR was revaluedas a basket of four currencies—the dollar, the pound, the euro and the yen. The USdollar value of an SDR is recalculated daily using fixed weights for the fourcurrencies. Every five years, the IMF adjusts the weights based on the value ofexports and external holdings of reserves denominated in each currency.

If China, or any other country, decides to value its reserves in SDRs, it can do so.The weights on the four currencies are known, so countries can create SDRequivalent holdings. SDRs cannot be used in payments except in transactionsbetween central banks. Private holdings of SDRs are not permitted. This eliminatestheir use as a means of payment.

4 Reforming the IMF

Discussion of IMF reform almost always refers to changes in the allocation of votesat IMF meetings. Critics note that the allocation of votes has changed very littlesince the original allocation in 1944. There are now many more countries, andrelative sizes have changed.

There is no reason to doubt that some countries want more votes to recognizetheir increased prominence. Shifting control from lenders and creditors to borrowersand debtors is not in the interests of the IMF as a lending organization. Successfullenders follow prudent lending policies. Pressures are strong to lend to somecountries that are imprudent. Transferring control to such countries is likely toreduce financial support.

Proponents of reorganization claim that a main reason for redistributing votes is toincrease acceptance of IMF programs in developing countries. In part, this is aresponse to the heavy handed way that the IMF responded to the Asian crisis in1998. As noted above, Asian countries have massively increased their reserves andestablished their own lending facility. They are unlikely to welcome IMF assistancesoon again.

Further, the new IMF has eased the terms it requires of borrowers and increasedthe amounts it lends. It did not require a major change in organization or voting. Itremains true, of course, that the distribution of votes reflects circumstances in 1945,not the greatly changed distribution in 2010. As most proponents of reformrecognize, the European Union should replace the separate votes of the WWIIEuropean allies.

Procedures for choosing the IMF’s Managing Director is a contentious issue also.From its start, the IMF has always selected a European as Managing Director. ThePresident of the World Bank has always been an American. These traditions willchange in the direction of making the process more open and including leaders fromall countries in the pool of eligible candidates.

These political issues arouse passions, but they seem no closer to resolution thanin the past. Small changes in votes are called unsatisfactory (Kelkar et al. 2004).

448 A. H. Meltzer

Large reallocations that combine the separate votes of Britain, France, Netherlands,and Belgium into a single vote for the euro-area have not been accepted by thecountries that would lose influence.

Evidence of the belief that the IMF is not effective as recently constituted comesfrom the large literature on IMF and international financial reform. Before agreeingto increase IMF resources, the U.S. Congress appointed the International FinancialInstitution Advisory Commission (Meltzer et al. 2000); I served as chair, so thecommission was called the Meltzer Commission. Ted Truman (2006) gave acomprehensive discussion of IMF reform proposals in a volume that includedrecommendations from the then current Managing Director and other knowledgeableexperts including Truman.

First, developing countries learned that if they do not pay their debts, thedeveloped countries forgive the debts without imposing or enforcing reforms. Debtforgiveness creates a disincentive to reform policy and reduce corruption. Thedisincentive weakens the already weak incentives to repay debt. Recognizing theproblem, the Meltzer Commission proposed to substitute monitored grants forsubsidized loans. The proposal was adopted by some of the multilateral lenders. Theweakness is the absence of strong enforcement procedures.

Many of the reform proposals rely mainly on exhortation to improve outcomes.The report issued by a study group sponsored by Council on Foreign Relations(Truman 2006: 49) urges “effective steps to reduce their crisis vulnerability” andelsewhere “fair burden sharing” in workout situations. But the report also urges theIMF to end large rescue packages and keep to its much smaller country limits. Inpractice, the IMF has gone in the other direction with the relatively large loans toRomania, Ukraine and others discussed earlier.

Lawrence Summers, at the time U.S. Treasury Secretary, proposed a “flow ofbetter information” and told the IMF to “be selective in providing financial support”(Truman 2006: 50). He also urged the IMF to “refocus support of growth andpoverty reduction in the low-income countries.” (ibid.)

These examples are representative of many proposals. Like much regulation ofdomestic banks and financial institutions, the proposals do not change incentives.Regulation that does not change incentives rarely achieves its objectives (Frey 1984;Vaubel 1986, 2006). My two laws of regulation explain why.

First, regulations are drafted by lawyers and bureaucrats. Markets circumventcostly regulations. Second, regulation is static, but markets are dynamic. If marketsdo not circumvent costly regulation at first, they will later. The Basle Agreementoffers an example of circumvention. It required banks to hold more capital if theyheld risky mortgages. Banks opened off-balance sheet entities that were not subjectto the regulation. Circumvention was completely legal. After the collapse of housingprices, the banks had to absorb the losses, but lasting damage was done.

Bank deposits are insured against loss de facto or de jure everywhere. Thepurpose is to protect the payments system from collapse thereby forcing economicactivity to stop. With bank deposits insured by a government agency, someregulation of bank risk taking becomes mandatory. Regulation of capital requirementsshould require banks to hold sufficient capital to absorb losses. A simpleincentive scheme would require banks to increase capital reserves more than inproportion to their increases in assets. Instead of the incentive to expand and take

The IMF returns 449

risk implicit in too big to fail policies, there would be greater disincentive toexpand and take large risks.

This principle, use incentives to enforce financial discipline, should apply to IMFlending. The Meltzer Commission proposed that financially prudent countries shouldbe granted stand-by credit facilities to protect them against crises coming fromexternal sources. For ten years, the IMF rejected the idea because the staff wasconcerned that a prudent borrower might undertake imprudent actions once thestand-by credit was in place. That objection has been overcome and loans under theFlexible Credit Line have been approved for Mexico and Poland during the recentcrises. None of the loans has been drawn.

The IMF and many of the member governments want the IMF to intervene in anycrisis or financial problem that occurs. This encourages excessive risk and producesbehavior like that of Turkey, Argentina or India before reform. These countries wereamong those that borrowed from the IMF repeatedly. The Meltzer Commissionproposed that the IMF should lend to countries that are harmed by crises in othercountries but should not lend or assist financially a country that does not followprudent fiscal, monetary, and exchange rate policies.

This proposal recognizes that countries cannot always protect themselves againstevents in the countries with which they trade or to whom they lend. An internationalagency like the IMF can eliminate the externality of a spreading crisis. During theArgentine crises after 2000, Uruguay suffered from a large capital outflow caused byArgentines withdrawing deposits in Uruguayan banks. An IMF loan to Uruguay wasappropriate.

The late Peter Bauer was one of the few development experts who advocated freemarkets in place of command and control (Bauer 2009). His message applies no lessto the use of command and control techniques when used or advocated byinternational agencies. A main lesson of development, as Bauer often noted, is thatprivate markets typically find better, more workable solutions to problems thancommand and control. The same applies to problems in the management ofinternational finance. Unless the citizens want their country to follow prudentpolicies, support is limited and stabilization efforts fail.

That leaves the IMF with tasks that an individual country cannot undertake. TheIMF can collect and publish information that efficient markets require and the IMFcan keep problems from spreading from troubled countries to their neighbors andtrading partners.

5 Conclusion

The IMF began when the world operated on fixed exchange rates. Its task was to getsurplus and deficit countries to share in the task of maintaining fixed exchange ratesby lending and borrowing. Capital accounts in most countries reflected tradeimbalances. Very little private capital moved internationally.

Capital account imbalances became the principal source of problems in the LatinAmerican debt crises of the 1980s, the Asian crises of the 1990s, and the largecreditor position of Asian countries, particularly China. The IMF does not have theresources to manage these problems and it is not able to prevent them. Further, it

450 A. H. Meltzer

cannot expect to receive an increase in resources of the size that would be needed.The IMF can, perhaps, prevent the spread of crises in China or the United Statesfrom hurting neighbors. The new IMF has to recognize this limit on its future role.Current IMF Managing Director Mr. Strauss-Kahn exults that the “IMF is back.”Can it remain vibrant when its bad loans accumulate?

The IMF and other international organizations neglect the main developmentlesson of the past fifty years. As Easterly (2002) and others have insisted, aidprograms are less successful than market opening and competition at fosteringeconomic growth and poverty reduction. A smaller IMF concentrating on improvingmarket information, preventing the spread of crises, and encouraging market openingstill seems the right way for the future.

References

Bauer, P. (2009). In J. Dorn & B. S. Mitra (Eds.), Peter bauer and the economics of prosperity. NewDelhi: Academic Foundation.

Carbaugh, R. J., & D. W. Hedrick (2009). Will the dollar be dethroned as the main reserve currency?Global Economy Journal, 9(3), Art. 1.

Cooper, A. F., & Momani, B. (2005). Negotiating out of Argentina’s financial crisis: segmenting theinternational creditors. New Political Economy, 10(3), 305–320.

Dreher, A. (2009). IMF conditionality: theory and evidence. Public Choice, 141(1–2), 233–267.Dreher, A., & Jensen, N. M. (2007). Independent actor or agent? an empirical analysis of the impact of US

interests on IMF conditions. Journal of Law and Economics, 50(1), 105–124.Dreher, A., Sturm, J.-E., & Vreeland, J. (2009). Global Horse Trading: IMF loans for votes in the United

Nations Security Council. European Economic Review, 53, 742–757.Easterly, W. (2002). The elusive quest for growth: economist’s adventures and misadventures in the

tropics. Cambridge: MIT.Easterly, W. (2005). What did structural adjustment adjust? The association of policies and growth with

repeated IMF and World Bank adjustment loans. Journal of Development Economics, 76, 1–22.Frey, B. S. (1984). The public choice view of international political economy. International Organization,

38(1), 199–223.IMF (2003). Fiscal adjustments in IMF-supported programs, available at http://www.imf.org/external/np/

ieo/2003/fis/index.htm (accessed on August 16, 2010).IMF (2007). IMF 2007 Annual Report–Appendix I, available at http://www.imf.org/external/pubs/ft/ar/

2007/eng/pdf/file7.pdf (accessed on August 16, 2010).IMF (2008). The IMF’s New Income and Expenditure Framework—Frequently Asked Questions,

available at http://www.imf.org/external/np/exr/faq/incfaqs.htm# (accessed on August 16, 2010).IMF (2009). Transcript of a Press Conference by IMF Managing Director Dominique Strauss-Kahn at the

G-20 Summit, available at http://www.imf.org/external/np/tr/2009/tr040209.htm (accessed on August16, 2010).

IMF (2010). Factsheet—Special Drawing Rights (SDRs), IMF Website 31 January 2010, http://www.imf.org/external/np/exr/facts/sdr.htm (accessed on August 23, 2010).

Kelkar, V., Yadav, V., & Chaudhry, P. (2004). Reforming the governance of the International MonetaryFund. The World Economy, 27(5), 727–743.

McKeown, T. J. (2009). How U.S. decision-makers have assessed their control of multilateralorganizations: a review of the declassified literature. Review of International Organizations, 4(3),269–291.

Meghir, C., Vayanos, D., & Vettasv, N. (2010). The economic crisis in Greece: A time of reform andopportunity, 5 August 2010, http://greekeconomistsforreform.com/wp-content/uploads/Reform1.pdf(accessed on August 16, 2010).

Meltzer, A. H. (2006). Reviving the bank and fund. Review of International Organizations, 1, 49–59.Meltzer, A. H., et al. (2000). Report of the International Financial Institution Advisory Commission.

Washington: Government Printing Office.

The IMF returns 451

Steinwand, M. C., & Stone, R. W. (2008). The International Monetary Fund: a review of the recentevidence. Review of International Organizations, 3(2), 123–149.

Stone, R. W. (2002). Lending credibility: The International Monetary Fund and the post-communisttransition. Princeton: Princeton University Press.

Thacker, S. C. (1999). The high politics of IMF lending. World Politics, 52, 38–75.Truman, E. M. (Ed.). (2006). Reforming the IMF for the 21st century. Washington: Institute for

International Economics.Vaubel, R. (1986). A public choice approach to international organizations. Public Choice, 51, 39–57.Vaubel, R. (2006). Principal-agent problems in international organizations. Review of International

Organizations, 1(2), 125–138.Vreeland, J. R. (2006). IMF program compliance: aggregate index versus policy specific research

strategies. Review of International Organizations, 1(4), 359–378.

452 A. H. Meltzer