Endnotes

¹For example Truman (2008), IMF (2008a, 2008b), Bryant (2008a, 2008b), Cooper and Truman (2007), Dervis and Ozer (2005). A wider range of studies, some addressing structural issues as well as reform options, are collected in Truman (2006).

²The proposed International Trade Organization was not agreed upon, and the General Agreements on Tariffs and Trade was established instead to manage trade relations. It was replaced with the WTO in 1994.

³The Group of Twenty-four (G24) (prominent emerging market economies) and the Group of Seventy-seven (G77) (a more inclusive group of emerging economies) provide additional forums for developing country views. Brazil, Russia, India, and People's Republic of China (PRC) (the BRICs) have also attracted attention as a forum for the four most powerful emerging economies.

⁴See Sandler and Tschirhart (1980) for a comprehensive survey. Seminal contributions were made by Buchanan (1965).

⁵These pressures apply to all international clubs; for example, the European Union (EU) expanded widely into Eastern Europe, and the Asia-Pacific Economic Cooperation (APEC) has included Latin American countries and Russia, and even the G20, just between its November 2008 and April 2009 meetings, expanding from 20 to 29 participants.

⁶If clubs were easy to close, these objectives would merge, as the founders could dissolve an inefficient club, liquidate its assets, and distribute its assets back to the owners. However, clubs seldom dissolve this way.

⁷An example of such exceptional longevity is provided by the Organisation for Economic Co-operation and Development (OECD), which was established to oversee the Marshall Plan in 1948. Although this mission ended in 1951, the OECD found new missions and even a new name. In recent years it has become an especially useful platform for groups of countries that seek to find common ground and best practices in structural issues such as subsidies, investment, and competition policy.

⁸It has been argued, for example, that the APEC grouping was formed preemptively to prevent the development of a narrower East Asian economic grouping proposed by some Asian countries at the time.

⁹See http://www.imf.org/external/work.htm for details.

¹⁰For more information on the IMF's bilateral surveillance activities, see Decision on Bilateral Surveillance over Members' Policies (http://www.imf.org/external/np/sec/pn/2007/pn0769.htm#decision).

¹¹In this relatively new effort to increase transparency, the IMF needs the consent of the member country to publish the notice. Most countries have been giving their consent.

¹²Other IMF facilities address balance-of-payments problems due to special causes such as structural problems, natural disasters, military conflicts, trade liberalization, and exogenous shocks. Poverty reduction is not an explicit IMF objective, but the IMF can offer concessional interest rates to low-income countries through its Poverty Reduction and Growth Facility.

¹³The FCL allows longer repayment periods (3.25–5 years) and imposes no hard cap on access to IMF resources, which will be assessed on a case-by-case basis (the SLF limited access to 500% of quota), and introduces flexibility to draw at any time on the credit line so that it can be used as a precautionary instrument which was not allowed under the SLF). A similar facility, called the contingent credit line, had been created in 1999 but was never used, and hence was allowed to cease in 2003 due lack of interest among potential borrower members.

¹⁴For example, Joyce and Sandler (2008) list the IMF's key functions as offering technical assistance, facilitating currency convertibility, providing a commitment device for policies, and creating insurance for correcting balance-of-payments problems without resorting to more costly measures.

¹⁵For the current IMF organization chart, see: http://www.imf.org/external/np/obp/orgcht.htm.

¹⁶For more information on the IMFC and Development Committee, see http://www.imf.org/external/np/exr/facts/ groups.htm#IC.

¹⁷The Board of Governors retains ultimate powers, including electing or appointing executive directors, and approving resolutions on the admittance of new members and the terms and conditions of their membership, the compulsory withdrawal of members, increases in IMF quotas, and amendments of the Articles of Agreement. It is also the ultimate arbiter on issues related to the interpretation of the Articles of Agreement.

¹⁸The US, Japan, PRC, Saudi Arabia, and the Russian Federation are single-country constituencies.

¹⁹Under SBAs and extended arrangements, a member can borrow up to 100% of its quota annually and 300% cumulatively, although it may have access to more funds under special circumstances.

²⁰See: http://www.imf.org/external/np/pp/2007/eng/071107.pdf for a discussion of the quota formulae and the data used to implement the quota formulae.

²¹For a breakdown of IMF member quotas and voting power, see http://www.imf.org/external/np/sec/memdir/members.htm.

²²In addition to an 85% majority, 60 positive votes are required.

²³The IMF's Board of Governors conducts general quota reviews every five years. Any proposed change to quotas must be approved by an 85% majority.

²⁴See Bryant (2008a) for a discussion of the proposed quota formula.

²⁵See Linn, Bryant, and Bradford (2008). Since these proposals are amendments to the Articles of Agreement, they will require legislative approval in several member countries.

²⁶ASEAN member countries (Brunei Darussalam, Cambodia, Indonesia, Lao People's Democratic Republic, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Viet Nam) plus PRC, Japan, and Republic of Korea.

²⁷Under the CMIM, each country would manage its reserves independently, but an amount committed to the CMIM would be earmarked for CMIM use.

²⁸These carry a small service charge of 0.75% on funds paid out.

²⁹The deferred drawdown option.

³⁰See http://go.worldbank.org/9Q8KOMQPE0 for more details and a list of current members of the Executive Board.

³¹For more information on ADB's organizational structure, see http://www.adb.org/About/membership.asp; http://www.adb.org/GOV/default.asp; and http://www.adb.org/BOD/default.asp.

³²Keohane and Nye (2003) suggest that within universal institutions, small clubs typically emerge in order to promote and control the institution's policies. For such groups to be effective, they have to undermine the institution's democratic process.

³³The Meltzer report (2000) also envisioned limiting the World Bank's role to these intrinsically global public goods. However, that report saw little need for development finance beyond such public goods. In our view, such decisions should be left to groups of member countries. They could interpret public goods differently and may support projects, such as regional technology development, that would not be funded by a universal membership.

³⁴See Kawai and Wignaraja (2009).

³⁵Membership of the FSB has been expanded to include all G20 members and a few others.

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