Seeing Like the IMF on Capital Account Liberalisation

This article explores the ideational dynamics that shaped the International Monetary Fund's (IMF) campaign to establish capital mobility as a formal obligation of IMF membership during the 1990s. First, the article examines how the IMF made the issue of capital account liberalisation ‘legible’ through constructing a particular ‘legibility map’ on capital mobility, which was rigorously promoted across its membership. Second, the article explores the processes through which the IMF's legibility map on capital mobility was accepted by the organisation's member states. The article traces debates within the IMF Executive Board relating to the decision to amend the IMF's Articles of Agreement to give the organisation a formal mandate and jurisdiction over capital account liberalisation to complement its existing mandate and jurisdiction over current account transactions. By tracing the negotiations on this amendment proposal, the article illustrates how the IMF used the ambiguities inherent within its cognitive map on capital account liberalisation to persuade member countries of the need to amend its Articles of Agreement. In the wake of the Asian crisis, however, the persuasiveness of the IMF's policy preferences on capital mobility quickly declined in tandem with a broader deterioration in the organisation's cognitive authority in the world economy.