Norms, Legitimacy, and Global Financial Governance

WEFRP Working Paper No. WEF 0013

65 Pages Posted: 31 Oct 2006

See all articles by Geoffrey R. D. Underhill

Geoffrey R. D. Underhill

University of Amsterdam - Amsterdam Institute for Social Science Research (AISSR)

Xiaoke Zhang

University of Nottingham - School of Politics

Date Written: September 2006

Abstract

Despite regular and serious systemic volatility, reform of international financial architecture remains limited, retaining market-oriented characteristics and adjustment mechanisms. A failure of the architecture to focus on the political underpinnings of global financial and monetary governance yields crucial deficiencies. The article defends three propositions implying a serious challenge to political legitimacy in contemporary financial governance: i) external financial constraints conflict with a range of potential domestic, particularly democratic, political imperatives; ii) developed state initiated global financial integration strengthens private interests in the policy process, narrowing the definition of the public interest in a democratic context; iii) market-friendly institutional reforms put pressure on domestic socio-political arrangements underpinning longer run political legitimacy. The article first analyses norms and legitimacy in global financial governance; then outlines the constraints on public policy of global financial market integration in the light of the foregoing analysis of legitimacy; thirdly it discusses possible solutions.

Suggested Citation

Underhill, Geoffrey R. D. and Zhang, Xiaoke, Norms, Legitimacy, and Global Financial Governance (September 2006). WEFRP Working Paper No. WEF 0013. Available at SSRN: https://ssrn.com/abstract=941389 or http://dx.doi.org/10.2139/ssrn.941389

Geoffrey R. D. Underhill (Contact Author)

University of Amsterdam - Amsterdam Institute for Social Science Research (AISSR) ( email )

Amsterdam, 1012 CX
Netherlands
+31 20 525 2172 (Phone)
+31 20 525 2086 (Fax)

Xiaoke Zhang

University of Nottingham - School of Politics ( email )

Nottingham
United Kingdom
+44 115 846 7781 (Phone)

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