The Bretton Woods Institutions: Evolution, Reform and Change

Abstract

The acute financial crisis that threatens the middle-income countries and the chronic development crisis that grips most of the low-income countries call for a radical reform of the Bretton Woods institutions. This paper employs historical and institutional approaches in trying to understand the sources of the failures and limitations of the Bretton Woods institutions and suggests directions for reform and change. After identifying the main driving forces behind their historical evolution, the paper discusses reforming the institutional practices and redefining the roles of the Bretton Woods institutions in order to face the challenges of the two crises and offers some thoughts on strategies for reform.