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World Bank Essay

1191 words - 5 pages

International institutions, such as the IMF, the World Bank, and the GATT/WTO, have shaped the global political economy for decades and continue to do so now. For this paper, I will be assessing, from the realist perspective, how the role of the World Bank in the global political economy has changed over the past four decades. The main objective is to indicate that throughout the past four decades, the United States has had a distinct influence, using its hegemonic power, on the World Bank and it’s role in the global political economy. From the origin of the World Bank, we can see that the United States, to an extent, has influenced and continues to influence the decisions made within the Bank. This type of influence ultimately affects how the World Bank functions within a global political economy.
It is essential to first understand the purpose of the World Bank and how it came to be, before assessing its role in the global political economy. The World Bank as a Transnational Expertised Institution is one of the most important sources of knowledge for development and poverty reduction. The World Bank was created by planners at Bretton Woods in 1944, together with the International Monetary Fund (IMF), as the public sector and intergovernmental financial cooperative (St. Clair, 78, 2006). The Bank’s purpose was to essentially rebuild post-World War II Europe. However, today the World Bank functions as an international institution dedicated to fighting poverty by providing developmental assistance to middle-income and low-income countries. Some methods the World Banks uses in eliminating poverty include “giving loans and offering advice and training in both the private and public sector” (World Bank, 2013).
Although the World Bank does carry a certain measure of autonomy, it is systematically subject to the influence of states. Realists place a lot of emphasis on power, and ultimately believe that international institutions have little independent impact and argue that their influence is derived from the actions of the states within them. Realists, such as Robert Gilpin, believe that many international institutions such as the World Bank, are controlled by the hegemonic states, and thus reflect the states interests. It can be shown that the United States uses the World Bank as a subtle mechanism to exert its influence on countries. Essentially, it is vital to focus on the impact of US power rather than the character of the institution itself. The United States plays an exclusive role in influencing and shaping development priorities for the World Bank. This is due to the fact that the United States is the only shareholder that retains veto power over changed in the Bank’s structure (Weaver, 2007). Simply by noticing how the World Bank is situated in Washington D.C, possesses English as the working language and also has a large prevalence of US trained specialists, it is evident that the US indirectly displays its power and influence over the...

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