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2004-03: IMF Quotas, Representation and Governance

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Authors: Karen Taylor, Craig Tipping and Adam McKissack

The International Monetary Fund (IMF) is a cooperative institution established to meet the common objectives of international financial stability and economic growth. The IMF’s legitimacy and effectiveness in fulfilling these objectives depends critically on its ability to adequately represent all its membership.

The paper reviews the evolution of the IMF’s representational arrangements, particularly the quota shares of members. It also canvasses alternative ways of measuring relative economic weight. It concludes that, despite difficulties in measuring the relative economic importance of member countries, a pattern of over- and under-representation is apparent, with East Asia being particularly under-represented.

The paper also seeks to put the quotas issue into perspective, noting there are a range of factors that impact on the representation of IMF members, including strategic use of voting blocs and the use of the constituency system. Finally, the paper suggests a more general examination of the operations of the IMF Executive Board could provide further insights into questions of effectiveness of representation at the institution.