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The Emergence of a Socialized Principal in the Global Financial Governance

Thursday 12 May 2016
Matthias de Vrieshof
Matthias de Vrieshof 4
2311 BZ Leiden

In L-PEG’s fourth Spring 2016 talk dr. Jue Wang will speak about China-IMF relations:

The Emergence of a Socialized Principal in the Global Financial Governance: an analysis of the China-IMF relationship

This paper assesses the relationship between China and the IMF in a principal-agent theoretical framework. China is regarded as a member of the IMF’s ‘collective principal’, and it is also a ‘socialized principal’ with clear objectives to exert larger influences in a reformed global financial system. Attracted by the IMF’s outstanding functions, China delegates various tasks such as technical assistance, surveillance and policy advice, and international monetary reforms to the IMF, the agent. The paper investigates China’s increasing engagement with IMF programmes since 1980 and argues the consequence of delegation depends on the preference proximity between the Chinese authorities and the IMF and China’s decision-making power compared to other powerful members of the IMF’s collective principal in both formal and informal governance structure. When powerful members of the collective principal have conflicted preferences, IMF staff have larger autonomy to find equilibrium to solve the conflicts.

All are welcome to attend. If you wish to receive a copy of the paper ahead of the seminar, please register in advance by emailing l-peg@hum.leidenuniv.nl .

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