## Rethinking the Governance of the International Monetary Fund

_IMF Working Papers, December 1, 2006_

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## Bibliographic details
- Authors: Abbas Mirakhor, Iqbal Mehdi Zaidi
- Published: December 1, 2006
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451865332.001

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### Summary
- Paper objective: set out the principal issues that need to be resolved in formulating a proposal for quotas and voice reform in the IMF that could command broad support.
- Theoretical framework: follows John Rawls and uses his theory of justice to provide a method for understanding what should be the case, in the context of voice and voting shares, before international institutions, such as the IMF, are to be justifiable to their members.
- Core argument: implementation of this process suggests that a major revision of the quota formulas is long overdue.
- Risk highlighted: leaving quota formula revision unaddressed raises serious questions regarding the IMF's governance which could develop into a core mission risk and jeopardize the relevance of the institution.

### Findings and analysis
- Justice as foundational: "justice is the first virtue of social institutions," — this normative premise is used to evaluate voice and voting shares in the IMF.
- Quota formula shortcomings:
  - A major revision of the quota formulas is long overdue.
  - Current formula issues imply governance concerns that may threaten the IMF’s relevance.
- Contextual subjects addressed: Capital flows, Financial crises, International reserves, Labor, Market exchange rates.

### Policy implications and recommendations
- Reform imperative:
  - Formulate quota and voice reform proposals that can command broad support among IMF members.
  - Undertake major revision of the quota formulas to address governance deficiencies and reduce core mission risk.
- Procedural recommendation:
  - Use Rawlsian justice-based method as a guiding framework for determining fair distribution of voice and voting shares.

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_Source: https://www.imf.org/en/publications/wp/issues/2016/12/31/rethinking-the-governance-of-the-international-monetary-fund-20149_