Financing the Future

Abstract

AbstractThis book explains how the governance and operational model of multilateral development banks shapes their behavior as a unique class of international organization. The book proposes a theoretical framework—based around MDB governance arrangements and the financial imperatives built into the MDB model—that permits a systematic analysis of the entire range of existing MDBs, regardless of their size and membership. Based on extensive document research, data collection, and interviews with MDB staff and country shareholders, the book then shows how this theoretical framework plays out in three different sets of MDBs: the World Bank and major regional MDBs controlled by wealthy countries; a group of twelve smaller, borrower-led MDBs; and the recently-created New Development Bank and Asia Infrastructure Investment Bank. Compared to existing literature on MDBs, this book takes a broader approach to understanding how shareholder interests impact MDBs by looking beyond the U.S. and G7 and focusing on the balance of power between borrower and non-borrower country shareholders. It also digs much deeper into the mechanics of how the financial imperatives built into the MDB model affect MDB behavior, in particular the need to obtain three types of resources: shareholder capital, external funding and borrower demand for loans. The book is targeted to both academia and the development policy community, as well as those with a general interest in international organizations and international development.