The IMF changes its tune on neoliberalism (a little)

International_Monetary_Fund_logo.svgHere is a link to a recent article by IMF researchers which backtracks on some of the tenets of that institution’s policy during what could be called the neoliberal era. It makes for interesting reading.

In particular, they make the case for capital controls to stabilize financial flows in certain circumstances; for reductions in inequality through ‘predistribution’ or redistribution in order to promote more sustainable economic growth; and they cast doubt on the wisdom of austerity which aims to reduce public debt as a share of GDP through tax rises and spending reductions instead of simply through policies to promote growth.

The piece does not wholeheartedly reject neoliberalism. In fact the authors praise certain aspects of it, such as the role of the expansion of international trade in reducing poverty. But this seems like a small step in the right direction.

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2 thoughts on “The IMF changes its tune on neoliberalism (a little)

  1. I agree with you that the thickly worded IMF language in the article is a small step in the right direction.

    As you know, many factors have created a need to verbally acknowledge that there needs to be a shift somewhat in economic directions. In addition, when many neoliberal economic policies are combined with the effects of record low Interest Rates, it’s apparent that a paradigm shift in economic thought is now occurring.

    Thx for the IMF link!

    • No problem glad you found it useful. I am not as confident as you that a seachange in economic thought is underway, but there are movements working in that direction. Thanks for your comment.

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