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Continuity, Discontinuity and Incoherence in the Bretton Woods Order: A Hirschmanian Reading

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  • Ilene Grabel

Abstract

This article examines the effects of the Asian crisis and especially the global financial crisis on developmental finance (that is, long‐term project finance and counter‐cyclical liquidity support) and the global financial architecture. In this connection three claims are advanced. The first is positive: that the crises occasioned meaningful although ad hoc, uneven discontinuities. The conjunction of discontinuities and continuities is imparting incoherence to the developmental and global financial architecture. The second claim is normative and controversial. Contrary to the common narrative, emergent incoherence is (on balance) productive of development and stability rather than debilitating. Actors in parts of the global South and East enjoy greater opportunities for institutional experimentation today in comparison with the limited space available in the coherent neoliberal era when the Bretton Woods institutions were monolithic. All of the experiments underway are not equally likely to survive, but even failures can provide lessons and networks that contribute to future successes. Emergent redundancy and new networks of institutional cooperation increase financial resilience. The article also explores the risks of incoherence and redundancy. The third claim is that productive incoherence can be understood within a ‘Hirschmanian mindset’ — an understanding of change and development informed by Albert Hirschman's theoretical and epistemic commitments.

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  • Ilene Grabel, 2019. "Continuity, Discontinuity and Incoherence in the Bretton Woods Order: A Hirschmanian Reading," Development and Change, International Institute of Social Studies, vol. 50(1), pages 46-71, January.
    • Handle: RePEc:bla:devchg:v:50:y:2019:i:1:p:46-71
    DOI: 10.1111/dech.12469
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    References listed on IDEAS

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    1. Helleiner Gerald K, 2010. "Towards Realistic Governance Reform in International Financial Institutions," Global Economy Journal, De Gruyter, vol. 10(3), pages 1-6, October.
    2. Ilene Grabel, 2018. "Reflections on the Economics Profession, the Neoliberal Conjuncture, and the Emerging Democratic Crisis: An Analysis in the Spirit of Albert O. Hirschman," Forum for Social Economics, Taylor & Francis Journals, vol. 47(2), pages 173-183, April.
    3. Alexander E. Kentikelenis & Thomas H. Stubbs & Lawrence P. King, 2016. "IMF conditionality and development policy space, 1985–2014," Review of International Political Economy, Taylor & Francis Journals, vol. 23(4), pages 543-582, July.
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    5. Ilene Grabel, 2015. "The rebranding of capital controls in an era of productive incoherence," Review of International Political Economy, Taylor & Francis Journals, vol. 22(1), pages 7-43, February.
    6. Helleiner, Eric, 2014. "The Status Quo Crisis: Global Financial Governance After the 2008 Meltdown," OUP Catalogue, Oxford University Press, number 9780199973637.
    7. Jeremy Adelman, 2013. "Worldly Philosopher: The Odyssey of Albert O. Hirschman," Economics Books, Princeton University Press, edition 1, number 9935.
    8. DeMartino, George F., 2011. "The Economist's Oath: On the Need for and Content of Professional Economic Ethics," OUP Catalogue, Oxford University Press, number 9780199730568.
    9. Mikko Huotari & Thilo Hanemann, 2014. "Emerging Powers and Change in the Global Financial Order," Global Policy, London School of Economics and Political Science, vol. 5(3), pages 298-310, September.
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    11. McKay Julie & Volz Ulrich & Wölfinger Regine, 2011. "Regional Financing Arrangements and the Stability of the International Monetary System," Journal of Globalization and Development, De Gruyter, vol. 2(1), pages 1-33, August.
    12. Ilene Grabel, 2011. "Not Your Grandfather’s IMF: Global Crisis, ‘Productive Incoherence’ and Developmental Policy Space (significantly revised)," Working Papers wp214_revisedb, Political Economy Research Institute, University of Massachusetts at Amherst.
    13. William Easterly (ed.), 2008. "Reinventing Foreign Aid," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262550660, April.
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    Cited by:

    1. DeMartino, George & Grabel, Ilene & Scoones, Ian, 2024. "Economics for an uncertain world," World Development, Elsevier, vol. 173(C).
    2. Evgeny Vinokurov, 2021. "Interaction of Eurasian and international financial institutions," Post-Communist Economies, Taylor & Francis Journals, vol. 33(2-3), pages 265-282, April.
    3. Devin T. Rafferty, 2020. "The “New†Neoclassical International Political Economy of Macroprudential Regulation and Capital Controls: “Style†over “Substanceâ€," Review of Radical Political Economics, Union for Radical Political Economics, vol. 52(4), pages 662-672, December.
    4. Ilene Grabel, 2023. "A World on Fire: Observations and Speculations in a Crottyian Vein," Review of Radical Political Economics, Union for Radical Political Economics, vol. 55(4), pages 707-713, December.
    5. Stubbs, Thomas & Kring, William & Laskaridis, Christina & Kentikelenis, Alexander & Gallagher, Kevin, 2021. "Whatever it takes? The global financial safety net, Covid-19, and developing countries," World Development, Elsevier, vol. 137(C).
    6. Evgeny Vinokurov & Artem Levenkov, 2021. "The Enlarged Global Financial Safety Net," Global Policy, London School of Economics and Political Science, vol. 12(1), pages 15-23, February.

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