The IMF and the emerging markets: A reappraisal of the central banking model

Country-level appraisals of international Monetary Fund (IMF) programs have eclipsed concerns with the global role of the organization. This reconsideration of the early central banking analogy is prompted by the emerging markets phenomenon. Drawing on the banking literature, the role of national reserve holdings In the context of adjustable exchange rates is addressed. The central bank parallel suggests that reserves complement the growth of obligations to international capital markets and a public goods case is made for IMF involvement In this connection. The prudential regulation aspect of central banking is also explored for its insights into the evolution of the Fund in the context of open capital markets. (C) 1997 Elsevier Science Lid. All rights reserved.