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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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    2. 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.
    3. 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.
    4. DeMartino, George & Grabel, Ilene & Scoones, Ian, 2024. "Economics for an uncertain world," World Development, Elsevier, vol. 173(C).
    5. 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.
    6. 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).

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