The Unassuming Economist

“The (International Monetary) Fund’s stance on equity has changed in parallel with external circumstances and the demands of its members, driven, sometimes forcefully, by its MDs. Poverty featured prominently in the Fund’s discourse in its early years when the institution began to take into account the voice and needs of its most vulnerable members. The 1980s and 1990s saw the consolidation of concessional financing, which broadened its focus towards equity between individuals and the “high-quality growth” championed by management and, at first, also by member countries. In the research conducted by the institution’s staff, inequality, social factors, and gender issues gradually gained prominence. These factors were included only to a limited extent and temporarily in the Fund’s activity, given the absence of strong support from the Board.

At the beginning of this century, there was growing disaffection with the Fund among developing countries, which demanded to be treated on a more equal footing. The far-reaching institutional and cultural reform of the IMF in the first decade of this millennium helped to put inequality and other macro-critical issues firmly on the Fund’s agenda. It is possible that the fallout from this century’s two major crises is contributing to consolidate inequality, gender, and the environment in the Fund’s activity and discourse. This may also have been assisted by the fact that the IMF has been led by two women in the recent past.

This paper has analysed how equity issues have been incorporated into the debate and design of the Fund’s policies and, through its texts, what stance each agent (management, member countries and staff) has adopted at each point in time. As a possible follow-up to this analysis, it is worth exploring the extent to which the Fund has put this “declaration of intent” into effect in its surveillance and lending activity and whether its implementation has been consistent with the general guidelines on equity. A text-mining analysis of the content of Article IV reports and IMF programmes could help assess the effective implementation of these issues, for which the annual reports provide only an approximation, and to verify the consistency between discourse, policy design and implementation.”

Source: Banco de España. 2021. The International Monetary Fund’s View of Social Equity Throughout Its 75 Years of Existence (p. 18)

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