chapter  6
15 Pages

Policy change: The case of World Bank and pension reforms

ByM. RAMESH

International organizations, both governmental and non-governmental, are often viewed as a key driver of changes in national policies (Drezner, 2001; 2005). Of these, the US-dominated World Bank ranks among the most significant sources of policy change, especially in promoting policy convergence across nations (Dethier, 2007). In the area of social policy, for example, the Bank is often portrayed as the lead preacher of policy reforms that inevitably lead to the bottom of the social welfare ladder, evident most prominently in the area of structural adjustment in indebted developing countries but also in many social policy areas such as pensions. (On the phenomena of the “race-tothe-bottom” also known as “Delaware effect,” see Berry et al, 2003; Greenwood, 2005; Konisky, 2007.) A close examination of World Bank policy position reveals, however, that

this portrayal is an exaggeration at best and a caricature at worst. And to the extent the Bank does act in ways that could be construed as promoting a raceto-the-bottom of social welfare, its positions are not cast in stone, as they do

International organizations, both governmental and non-governmental, are often viewed as a key driver of changes in national policies. Of these, the US-dominated World Bank ranks among the most significant sources of policy change, especially in promoting policy convergence across nations. A close examination of World Bank policy position reveals, however, that this portrayal is an exaggeration at best and a caricature at worst. This chapter analyzes the World Bank’s influence by examining two key documents it has published on the subject. The comparison will show that in recent years the Bank has been quite circumspect about its earlier advice promoting privatization of pension and is now engaged in efforts that expand income support while at the same time securing fiscal stability.