Deck 10: The International Financial Institutions

Question 1

Which of the following is true about the Bretton Woods system?

A) It was an economic plan developed in response to the economic crisis caused by World War I.
B) It established the World Trade Organization as the keystone of the global free trade regime.
C) It laid the basis for the original roles of the International Monetary Fund and World Bank.
D) It devised an international monetary financial plan to help decrease world debt.
E) It was a package of economic stimulus reforms, devised by Sir Bretton Woods, that enabled the defeated nations of the World War II to progress economically.

Answer 1

C

Question 2

What was the original name of the World Bank?

A) The International Bank of Reconstruction and Development
B) The Import-Export Bank
C) The Bank for International Development
D) The Bretton Woods Bank
E) The Grameen Bank

Answer 2

A

Question 3

What was the World Bank's original purpose?

A) To implement neoliberal structural adjustment policies
B) To make loans to war-torn European countries at preferential rates of interest
C) To provide short-term financing so countries could deal with balance of payments deficits
D) To oversee the activities and functions of the International Monetary Fund
E) To promote stable currency exchange to prevent competitive devaluation

Answer 3

B

Question 4

Which of the following was NOT an organization in the Bretton Woods system?

A) The International Monetary Fund
B) The World Bank
C) The International Development Association
D) The World Economic Forum
E) All of the above were involved in the Bretton Woods system.

Question 5

The US currently holds approximately what percentage of the voting rights within the IMF and World Bank?

A) 2 per cent
B) 6 per cent
C) 17 per cent
D) 35 per cent
E) 68 per cent

Question 6

Within the World Bank, how are board representatives chosen?

A) Through a committee
B) Through vote shares
C) Through the "one state, one vote" rule
D) Through the Office of the Director
E) Through a lottery

Question 7

What is the name of the organization within the World Bank responsible for providing interest-free loans with long repayment periods for developing countries?

A) International Development Association
B) International Monetary Fund
C) World Poverty Foundation
D) Global Institute for Poverty Reduction
E) International Aid Committee

Question 8

What was the initial function of the International Monetary Fund (IMF)?

A) To provide economic restructuring plans
B) To invest in economies in the Global South
C) To design large-scale capital investment projects
D) To help solve balance of payment problems
E) To seek to address trade imbalances

Question 9

In 1971, how did the United States effectively abolish the original Bretton Woods system?

A) By abandoning the floating exchange rate system in favour of a fixed rate of exchange
B) By suspending the convertibility of US dollars to gold
C) By effectively pulling the United States out of the UN Security Council
D) By suspending American payments to the UN
E) By annulling commitments to regulate structural adjustment policies

Question 10

Which of the following statements is NOT true of Robert McNamara's tenure as the president of the World Bank?

A) The Bank's operations were greatly expanded.
B) Bank lending was used to fund industrialization projects rather than agricultural reform.
C) The Bank was used as a tool to fight communism.
D) Bank lending shifted from large-scale infrastructural projects to anti-poverty projects.
E) The Bank's approach became known as the "basic needs" approach.

Question 11

Which of the following goals were included in the "basic needs" approach advocated by Robert McNamara?

A) Nutrition, housing, health, literacy, and employment
B) FDI, industrialization, cash crops
C) Large scale development and infrastructure projects
D) Institutional management, bottom-up planning, and joint decision making
E) Debt reduction, equitable income distribution, and participatory budgeting

Question 12

Which country was the first to threaten default on an outstanding debt?

A) Brazil
B) Chile
C) India
D) Mexico
E) Ethiopia

Question 13

Which term refers to the program of rapid price liberalization, currency devaluation, and fiscal discipline imposed by the IMF during structural adjustment?

A) Capitalist medicine
B) Neoliberal treatment
C) Deregulation program
D) Massive attack
E) Shock therapy

Question 14

Which of the following was NOT a factor that prompted a rethinking by the World Bank and IMF of their policies?

A) The "East Asian miracle"
B) The Mexican peso crisis
C) Stagnation in sub-Saharan Africa
D) The end of the Cold War and the communist threat
E) All of the above were factors.

Question 15

____________ refers to reforms aimed at tackling corruption, the rule of law, transparency, accountability, and judicial independence.

A) Good governance
B) Best practices
C) Efficiency model
D) Developmental state
E) Liberalization

Question 16

What did the immediate phase of structural adjustment programs consist of?

A) Liberalization
B) Austerity measures
C) Deflationary policies
D) Nationalization
E) Good governance

Question 17

In regards to development, in the early 2000s the World Bank moved to which of the following?

A) A singular agenda
B) A strategic agenda
C) A malleable agenda
D) A compassionate agenda
E) A comprehensive agenda

Question 18

What are foreign portfolio investments?

A) Investments that include the purchase of foreign debt, loans, and stock market investments
B) Investments that include the purchase of factories and other fixed investment
C) Investments that may be subject to international tax and trade treaties
D) Investments that contribute to economic and social stability
E) Investments that involve dealing in fine art and other luxury goods

Question 19

Which of the following replaced structural adjustment policies, and were designed to introduce national ownership and civil society participation into the creation of development policies?

A) Authentic Development Protocols
B) Declarations of Autonomous Development
C) Bilateral Lending Frameworks
D) Multilateral Aid Packages
E) Poverty Reduction Strategy Papers

Question 20

Which best defines "crony capitalism"?

A) Tight integration of economic, political, and military elites
B) Generational political leadership
C) Triangular decision making between banks, MNCs, and particular political parties
D) An overly close relationship between the government and local businesses
E) Nationally owned enterprises used for political versus economic goals

Question 21

The World Bank policy has promoted the concept of ____________ as the "missing link" in development theory that identifies networks and linkages an individual or a household can use to gain access to resources.

A) free trade
B) ethical markets
C) social capital
D) community councils
E) participatory budgeting frameworks

Question 22

By 2007, which middle-income country was the only major borrower from the IMF?

A) Brazil
B) Turkey
C) China
D) Argentina
E) South Korea

Question 23

Why have international financial institutions received criticism?

A) Because they hold annual meetings
B) Because their policies are contradictory
C) Because their policies prevent poverty
D) Because their policies ensure global stability
E) Because their policies increase poverty

Question 24

What is the main criticism against international financial institutions from conservatism?

A) The power of the multinational corporations.
B) Their relevant role in a globalized world.
C) The changes in their roles.
D) The role of the Bretton Woods Conference.
E) The war between the IMF and the World Bank.

Question 25

Why are structural adjustments controversial?

A) They are necessary to promote economic growth.
B) They fight poverty efficiently.
C) They failed to deliver on their primary promises of stable growth and poverty reduction.
D) They were not enough.
E) They helped preserve colonialism.

Question 26

What were the original objectives of the US delegation during the Bretton Woods Conference?

A) Overwhelming economic and military power
B) A system of relatively unrestricted world trade
C) The Bretton Woods System
D) The lack of a clear consensus
E) European power restitutions

Question 27

How was the first version of the World Bank affected by the US Marshall Plan?

A) The Marshall Plan began to provide credit directly to European nations affected by World War II.
B) The original IBRD changed its name to the World Bank.
C) European countries preferred to borrow money from the World Bank.
D) Since the reconstruction of Europe by the Marshall Plan, European countries could not ask for money.
E) None of the above

Question 28

How did the IBRD interact with new post-colonial nations?

A) It served as an intermediary between the international financial institutions.
B) It served as an intermediary between international banks and governments.
C) It served as an intermediary between governments.
D) It served as an intermediary between international powers and European governments.
E) It served as a direct link between the US foreign policy agencies and governments.

Question 29

How did the IMF first use its resources?

A) To finance mobile communication grids
B) To finance decolonization
C) To finance all kinds of projects
D) To help the US expansion programs
E) To finance the building of physical infrastructure

Question 30

What was the difference between IBRD and IDA?

A) The kind of credits they offer to specific groups of countries.
B) Nothing, they were actually the same kind of institutions.
C) IDA intended to establish a clear separation between IMF and the World Bank.
D) IDA concentrated in infrastructure projects.
E) IDA was set up by Japan.

Question 31

The IMF originally functioned as an instrument to maintain international currency stability.

Question 32

Like the UN, each country has one vote at the World Bank and IMF.

Question 33

In the first two decades of its existence, the World Bank focused mostly on small, anti-poverty projects.

Question 34

The US appoints the World Bank president, while Europe selects the president of the IMF.

Question 35

Under Robert McNamara, the World Bank's approach to development became known as the "basic needs" approach.

Question 36

The Washington Consensus is the term used to refer to a set of development policies that recognize the limitations of neoliberalism.

Question 37

Structural adjustment programs improved social conditions in sub-Saharan Africa in the 1980s and 1990s.

Question 38

Good governance implies the promotion of transparency and accountability.

Question 39

The Mexican Peso crisis followed an apparent "boom" in the country's economy in the late 1980s and early 1990s.

Question 40

In the early 2000s, the World Bank moved to a more "comprehensive" approach to development.

Question 41

The international financial institutions dissuade developing countries from accepting "foreign portfolio investments."

Question 42

In the 1990s, the IMF discouraged developing countries from opening up their stock markets to foreign investors.

Question 43

The countries that were least affected by the East Asian financial crisis were those with the least capital account liberalization.

Question 44

Current voting rights in the IFIs have been adapted to recognize the rising importance of the G20 states.

Question 45

The Poverty Reduction Strategy Papers formalize a clear division of labour between the World Bank and the IMF.

Question 46

The Asian Infrastructure Investment Bank represents a response from China to the continued Western influence over the IFIs.

Question 47

"Vulnerability" and "voicelessness" are now of primary focus in the World Bank's strategies on poverty reduction.

Question 48

The World Bank has recognized and become a key player in combatting climate change.

Question 49

In 2005, Argentina argued Latin American states should sever links with the IMF.

Question 50

The World Bank now suggests that it needs to "empower" the poor.

Question 51

The 2008 financial crisis sparked a food crisis in the Global South.

Question 52

The World Bank now seeks to "empower" the poor by encouraging the fostering of trade unions and encouraging wealth redistribution.

Question 53

Many countries in the Global South do not possess large-scale deficit financing to prop up consumption and alleviate unemployment.

Question 54

The global economic crisis of 2008 provided an opportunity for both the IMF and the World Bank to reinvent and reassert their roles.

Question 55

The post-2008 IMF continued to give countries in the Global South constraining targets for budget deficits and monetary policies.

Question 56

In the World Bank, the 2008 crisis precipitated a new emphasis on building "resilience" in borrower countries.

Question 57

The World Bank's Africa Climate Business Plan is an example of structural adjustments.

Question 58

The World Bank solely invests money in clean-energy projects, as a way to combat climate change.

Question 59

China has repeatedly sought to use development funding as a means to open markets and exercise leverage across the post-colonial world, particularly in sub-Saharan Africa and Central Asia.

Question 60

IFIs entered the new millennium by re-emphasizing their role as global poverty alleviators.

Question 61

Poverty reduction is not a major focus for the IMF and World Bank.

Question 62

What was the initial function of the IMF?

Question 63

Discuss reasons for the establishment of the International Development Agency within the International Bank of Reconstruction and Development in 1960.

Question 64

Describe the governance structures of the IMF and the World Bank.

Question 65

What changes did Robert McNamara make when he became president of the World Bank in 1968?

Question 66

Explain the 1980s debt crisis and the response of the IMF and the World Bank.

Question 67

What role did the "East Asian miracle" play in triggering a rethink of IMF and World Bank policies?

Question 68

In its 2001 report, what "lessons" did the World Bank claim to have learned about the successes and failures of structural adjustment programs?

Question 69

What was the "Mexican peso crisis" and how did it affect views on structural adjustment programs?

Question 70

What criticisms have been levelled against the World Bank's notion of "good governance"?

Question 71

How is the World Bank's new approach to development more "comprehensive"?

Question 72

What are Poverty Reduction Strategy Papers and what are some criticisms made against them?

Question 73

Discuss the World Bank's recent turn toward promoting "empowerment."

Question 74

How has the global financial crisis of 2008 hurt developing economies?

Question 75

How has the 2008 financial crisis generated change in the IFIs?

Question 76

How has the World Bank approached climate change?

Question 77

Why is the Asian Infrastructure Investment Bank significant?

Question 78

How did Argentina's President Kirchner respond when paying back the IMF in 2005?

Question 79

How does the World Bank conceive of poverty?

Question 80

Explain the World Bank's idea of "social capital" as the "missing link" in poverty reduction.