IMF and its Role in International Political Economy
Political economy is not a new word for us because of the close relationships between politics and the economy. The development in politics is due to the development in society and the development in society is mostly driven by the economy. The parallel existence and mutual interaction of ‘state’ and ‘market’ in the modern world creates ‘political economy’; without both state and market there could be no political economy (Gilpin, 2003, P9). Market allocates resources to a particular group, class or region where conditions are most favorable. As a consequence, market economies result in the uneven development both domestically and internationally. As our issue is about international political economy, the connection is the uneven development in different economic systems of nations lead to the uneven status of countries around the world. The struggle among groups and states over the distribution of benefits and costs has become a major feature of international relations in the modern world (Gilpin, 2003, P21, par.2). It is sure that market or economy has a big influence on sovereign states. The changing market is very likely to change states. So the economy is crucial for a country, in a globalizing world with vast of interactivities among countries, to get a place. As a part of globalization, the globalization of finance, arguing that it has fundamentally altered the traditional monetary relationship between states and markets, ultimately undermines national monetary sovereignty (Cohen, 2003, P215).
Because of the importance of finance in globalization and in the world political economy, organ...
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