The IMF and Experimentalist Governance in Small Western States

Abstract

The International Monetary Fund (IMF) is an organization charged with the responsibility to observe governance experiments to enhance institutional competitiveness in its member states. While the IMF's role in propagating certain forms of institutional competitiveness in developing economies is commonly discussed, less emphasis has been placed on how the IMF seeks to transfer policy knowledge, and to learn from, the governance of institutional competitiveness in its developed Western member states. This article provides a corrective by providing an analysis of IMF staff and Executive Board advice on taxation and monetary reform to two ‘coordinated’ market economies, Denmark and Sweden, and two ‘liberal’ market economies, Australia and New Zealand, from 1975 to 2004. The article traces how IMF staff and Executive Board advice compares with actual changes to taxation and monetary regimes in these four small open economies. In sum, this article explores the notion that the IMF is an ‘experimentalist governance’ organization that seeks to build its comparative knowledge of policy reform, providing a contrast with the common depiction of the IMF as an institution that dictates ‘neoliberal’ policy homogeneity.