Questions and Answers of Global Finance

In your view, is the fact that the systemic nature of finance is ignored in mainstream debates a matter of ideology, interests or something else?
Is it desirable or feasible for countries to de-globalise?
How would you advise the government of a developing country of your choice to proceed with financial liberalisation and regulation?
Which of the theoretical approaches is, in your view, most persuasive? Or which combination?
Understand the range of alternative policy strategies available to developing countries to manage financial crises.
Develop your own view on the most relevant theoretical approach to adopt and/or insights from a combination of approaches.
Be able to put global finance in its place, in terms of its significance in improving the wealth, welfare and freedoms of poor countries and poor people in developing countries.
Appreciate the capital fundamentalism of the orthodox mainstream, and the underplaying of systemic and political factors in the analysis of finance and development.
Assuming that microfinance continues to be scaled-up what, in your view, is its fate?
Is microfinance a neoliberal Trojan horse or a progressive developmental intervention?
What should the measure of success be? 3 3 What are the major choices to be made in rolling out a microfinance programme? What would your choices be and why?
How should microfinance be evaluated? How do we know whether it works or not?
Where would you start in providing financial services to an underserved community: credit, savings or insurance?
Be aware of the political debates around scaling-up microfinance, its regulation, and the critical reformist and radical critiques of microfinance's role in shoring up the neoliberal global
Appreciate the ongoing dilemmas and decisions in the design and mission of microfinance in terms of outreach and sustainability, the double-bottom line, and microfinance plus.
See the differences between microcredit, savings and insurance, and the evidence base and debates around each.
Understand the mechanisms by which microfinance has traditionally worked, such as small loans, frequent repayments, group lending, rotating savings, as well as more recent formats such as individual
Appreciate the problems associated with financial exclusion, why the poor tend to be excluded from formal financial services and why they are undersupplied.
Understand the emergence of modern microfinance institutions and the demand for them, in particular the financial needs and services required by poor households.
What else should be done to assist migrants from developing countries?
Should remittances be channelled through the formal financial system as opposed to migrants being able to use informal channels?
To what extent do you agree with Dilip Ratha when he argues that what households do with their remittances shouldn't be subject to any direct intervention?
Given remittances' positive, but modest and heterogeneous, effect on poverty, and the ambiguous effects on inequality and growth, as well as the negative effect on international inequalities, are
What is driving the international policy community's remittance euphoria?
Be aware of the radical and critical reformist critiques of the orthodox mainstream logic and agenda.
See and explain the influence of the liberal institutionalist paradigm in shaping the public policy attempts to harness the developmental potential of remittances.
Understand the impact of remittances on poverty, inequality, welfare outcomes and financial development in and between developing countries.
Appreciate the importance and occasional invisibility of migrant labour as the very possibility of remittance flows.
Be able to explain the individual motives and the aggregate drivers of remittance flows.
Know the history and emergence of international remittances within the development agenda, so-called 'remittance euphoria'.
What do you make of Joan Robinson's (1962: 45) notion that 'the misery of being exploited by capitalists is nothing compared to the misery of not being exploited at all'?
Given that equity portfolio flows are extremely concentrated in emerging markets, are there any advantages of LICS trying to attract this type of investment?
How should countries best attract and harness the potential of equity flows? Liberalise? Strengthen institutions and rules? Operate with strict seclusions and manage firms? Minimise these flows?
Do the benefits of not building up indebtedness outweigh the costs of devolving sovereignty or ownership to foreign economic actors?
Given that the foreign affiliates of TNCs are only responsible for 7.9 per cent of all employment in developing countries (UNCTAD 2012), what is their importance? Are they important for development?
Understand the contemporary policy and political debates around regulation and taxation.
Be aware of the controversial nature of foreign investment - despite the much-touted benefits of equity flows - in terms of the debates around exploitation, extraction, dependency and their
Understand the key drivers and developmental impact of equity, the role of transnational corporations (TNCs) and financial markets, and the importance of spillovers, complementarities and linkages.
Understand the history and geography of equity flows to the developing world, especially their concentrated nature.
Appreciate the increasing importance of FDI to many developing countries as the largest element of global financial flows.
Be able to distinguish between FDI and portfolio equity (or indirect investment), and how they are defined and measured.
How do you think the emergence of new aid donors in the coming years, such as China, will change the way international development is done?
When evaluating the effectiveness of aid, should the focus be on measuring economic growth or human development?
Do you think of aid as a grant or a loan? What should it be? Why?
How important is aid for the external financing of developing countries; all, some why?
Do you think aid is a (possibly imperfect) attempt to help developing countries or do you see it as a tool of imperialism?
Why do states give aid? Is this different from the motives of individuals and multilateral institutions?
Be aware of the contemporary policy issues surrounding the international aid regime such as aid effectiveness, donor coordination and transparency.
Understand the critical and radical critiques of aid as a form of imperialism and as perpetuating the dependency of low income countries.
Know the aid effectiveness debate, i.e. whether and how aid has an impact on development through economic growth and welfare measures.
Understand who gives development aid (donors), to whom (recipient or partner countries), and how (via a discussion of the different modalities or types of aid).
Know the history and geography of the international aid regime.
Be able to describe what aid is, its internationally agreed definitions and the accounting standards used to define what is and what isn't official development assistance.
5 Do financial crises or global imbalances represent the greatest threat to development?
4 Are economic or political factors the primary drivers of financial liberalistion?
3 In your view, are orthodox or heterodox views the most convincing account of financial crises? Are crises an inevitable part of development (as both neoliberal and radical scholars might argue) or
2 Given the trilemma faced by developing countries' governments, which priorities, in your view, offer the optimal strategy?
1 Why is it important to understand the historical evolution of the international monetary system?
Know the purpose and operation of capital controls and capital account liberalisation and the debate about their merits and disadvantages.
Show awareness of the consequences of the increasingly liberal international financial system in terms of the volume of capital and the frequency of financial crises and global imbalances.
Understand the trade-offs a government faces in deciding whether to prioritise monetary policy autonomy, exchange rate stability and access to international capital.
Understand the economic logic behind the key forms of the international monetary system over these eras - i.e. the gold standard, the gold-exchange standard of the Bretton Woods system, and the
Know the historical emergence of the international monetary system, the role of ideas and the domestic and international geopolitical pressures which helped to shape it in different eras.
Appreciate the centrality of the international monetary system to the functioning (or failure) of the world economy in terms of trade and investment flows.
Is finance the cause or solution to all of life's problems?
Which of the four theoretical approaches do you feel is the most convincing, and why?
What is the difference between a liberal institutionalist's view on the government playing a proactive role and the critical reformist's view?
Are governments capable of (and to be trusted with) steering the economy and financial markets better than the price mechanism?
Do, in your view, savings naturally lead to investment and development or is it investment that leads to development and savings?
Critically engage with the four different approaches; understand the family resemblance in the two orthodox and the two heterodox approaches; as well as understanding what's different and what's
Know the work of four key representatives of these schools (Anne Krueger, Justin Yifu Lin, Ha-Joon Chang and David Harvey).
Describe the four main approaches to the study of global finance and development: neoliberal, liberal institutionalist, critical reformist and radical.
Appreciate the role of savings and investment in this classical view and the need to turn to external sources of development financing.
Understand the classical approach to the problem of development as a gap to be filled by investment and capital accumulation.
5 Which financial flow do you anticipate is going to be the most significant for sustainable development? Can you give an illustration to back up your answer?
4 How do you think development should be measured and how should interventions be evaluated?
3 Is development about countries or people?
2 Do you think the MDGs capture most of what we need to focus on when we think about development? What's missing? What's superfluous in them?
1 Does the analogy between the domestic banking system and global finance make sense? If not, what doesn't work about the analogy?
Identify the key types of financial flows to developing countries and appreciate their varying volumes (in total and for individual countries), their different drivers and impacts on development.
Know the key measures and indicators of development, including economic growth, poverty, human development and inequality.
Develop your own position on what 'development' is, understanding that it is an essentially contested concept.
Appreciate that money is a necessary but insufficient part of the solution in addressing economic and human development and poverty reduction.
5 Take a developing country of your choice and assess the role of external finance in its development since 1945.
4 To what extent are the two visions of finance and development (FfD and PEF) mutually exclusive? Can they be usefully combined?
3 Is global finance a resource which provides the power to develop, or a structure of power over the poor?
2 What, in your view, poses the greater threat to development: financial crises or a lack of financing from donors and private investors?
1 Make a list of the most important 'binding constraints' on the development of poor countries and people. How high or low does money and finance come on this list?
• Develop your own position on what ‘fi nance’ is, understanding that it is an essentially contested concept.
• Understand that there are different ways of viewing the relationship between fi nance and development: fi nance as a resource for development and as a social structure within which development
• Know the international context that development finance operates in, in terms of poverty, inequality and welfare indicators.
• Understand the logic of the fi nancial system in mobilising capital for investment.
Appreciate the importance attached to external development fi nancing, especially in relationto meeting international development targets.