Can the United States be said to be dominant within the international Dissertation

Can the United States be said to be dominant within the international financial institutions of the IMF and the World Bank - Dissertation Example IMF (International Monetary Funds) and World Bank are the most prominent international financial institutions that were formed after the World War II with an objective to transfer capital funds from robust to starving countries in the world. Kapur (1999) says that the World Bank was established to serve the purpose of a financial cooperative with the patronage of economically strong countries of the world. The Bank was determined to raise funds from international market at lower rates and disperse them to the economically weaker countries for which it was not easy to borrow from international market at those rates as the Bank. IMF and World Bank have strong economic and political ties. A country willing to become a member of the latter needs to be a member of the former institution. The management framework of both these financial institutions is similar with the striking difference of share allocation system that ascertains the number of shares owned by each member country. Mistry illustrates that share allocation to the members of the World Bank follows no certain rules or obligations, however in the IMF, the share allocation is determined by Quota system where every country owns a specific number of fixed shares. Again in both these institutions, the borrowing countries hold a smaller ratio of the total shares as opposed to the shares owned by the economically stronger countries that enjoy influence over the entire minority. These institutions can exercise a great degree of influence both economically and politically.... Kapur (1999) says that the World Bank was established to serve the purpose of finance cooperative with the patronage of economically strong countries of the world. The Bank was determined to raise funds from international market at lower rates and disperse them to the economically weaker countries for which it was not easy to borrow from international market at those rates as the Bank. IMF and World Bank have strong economic and political ties. A country willing to become a member of the latter needs to be a member of former institution. The management framework of both these financial institutions are similar with the striking difference of share allocation system that ascertains the number of shares owned by each member country. Mistry (1995) illustrates that share allocation to the members of the World Bank follows no certain rules or obligations, however in the IMF, the share allocation is determined by Quota system where every country owns a specific number of fixed shares. Again in both these institutions the borrowing (developing) countries hold a smaller ratio of the total shares as opposed to the shares owned by the economically stronger countries that enjoy influence over the entire minority. These institutions can exercise a great degree of influence both economically and politically over the countries that choose to borrow from IMF and World Bank. Cox (1993) illuminates that the power and influence of these international financial institutions is due to the reasons that their conditions most prominently enhance their power over the borrowing countries, they are formed by economic super powers so as to maintain their power, and their key members mostly represent countries with high economic strength.