Developing country representation and governance of the International Monetary Fund

SummaryThis article examines the representation of developing countries in the IMF’s quota regime. We first describe how the Fund determines quotas according to countries’ relative positions in the world economy. Current quotas of member states are then compared to different measures of relative weight in the world economy. We also compare four different methods of computing quotas: current quotas, calculated quotas, quotas calculated using formulas proposed by the IMF’s external Quota Formula Review Group, and those proposed by former IMF Executive Director Vijay Kelkar. We find that developing countries are over-rather than under-represented if the focus is restricted to variables similar to those used by the IMF; introduction of other variables, for example, population or PPP-based versions of GDP, produces quite different results. The paper concludes with brief consideration of possible changes that would enhance developing country participation in Fund decision making.