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The proliferation of multilateral development banks

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  • Miles Kellerman

    (University of Oxford)

Abstract

Since 1945 the number of multilateral development banks (MDBs) has increased at a linear rate, with approximately one new MDB created every three years. The proliferation of MDBs has resulted in an inefficient duplication of international institutions with overlapping functions. Further, this trend contradicts our existing understanding of why states create countervailing international organizations. This article proposes a novel, two-step theoretical model of institutional change and creation in an attempt to explain this empirical puzzle. Utilizing the complementarities of rational-choice and historical institutionalism, the model demonstrates that the rational actions of states in the past can lead to seemingly irrational institutional change in the future. This process results in the repetitive creation of countervailing MDBs designed to solve the same functional problems. To evaluate the model’s hypotheses, three case studies are undertaken, employing archival material, internal documents, and 48 interviews conducted by the author in London, Washington, D.C. and Manila, Philippines. The empirical results are of direct interest to policy-makers currently negotiating the structure of new MDBs in Asia and Latin America.

Suggested Citation

  • Miles Kellerman, 2019. "The proliferation of multilateral development banks," The Review of International Organizations, Springer, vol. 14(1), pages 107-145, March.
    • Handle: RePEc:spr:revint:v:14:y:2019:i:1:d:10.1007_s11558-018-9302-y
    DOI: 10.1007/s11558-018-9302-y
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    2. Alvaro Mendez & David Patrick Houghton, 2020. "Sustainable Banking: The Role of Multilateral Development Banks as Norm Entrepreneurs," Sustainability, MDPI, vol. 12(3), pages 1-21, January.
    3. Victoria Kuzenkova, 2021. "Effective Development Institutions," Public administration issues, Higher School of Economics, issue 5, pages 161-175.
    4. Mette Eilstrup-Sangiovanni & Daniel Verdier, 2024. "To reform or to replace? Succession as a mechanism of institutional change in intergovernmental organisations," The Review of International Organizations, Springer, vol. 19(4), pages 691-719, October.
    5. Fleiss, Pablo, 2021. "Multilateral development banks in Latin America: Recent trends, the response to the pandemic, and the forthcoming role," Studies and Perspectives – ECLAC Office in Washington 46916, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    6. Laerte Apolinário Júnior & Felipe Jukemura, 2022. "A comparative analysis of the environmental and social policies of the AIIB and World Bank," Global Policy, London School of Economics and Political Science, vol. 13(5), pages 694-709, November.
    7. Israel Nyaburi Nyadera & Billy Agwanda & Murat Onder & Ibrahim Abdirahman Mukhtar, 2022. "Multilateralism, Developmental Regionalism, and the African Development Bank," Politics and Governance, Cogitatio Press, vol. 10(2), pages 82-94.
    8. Kong, Bo & Gallagher, Kevin P., 2021. "The new coal champion of the world: The political economy of Chinese overseas development finance for coal-fired power plants," Energy Policy, Elsevier, vol. 155(C).
    9. Alexandra O. Zeitz, 2021. "Emulate or differentiate?," The Review of International Organizations, Springer, vol. 16(2), pages 265-292, April.

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