ABSTRACT
With the recent advance in globalization, it has become popular to argue that countries need to adopt a certain set of institutions that meet the ‘global standards’ in order to survive in the new, borderless world. In particular, it is argued, countries that do not adopt global standard institutions will fail to grow fast, not only because the global standard institutions (henceforth GSIs) are the ones that promote growth but also because foreign investors will shun the countries with sub-standard institutions. The conviction in the virtue of the GSIs among those who promote them is so absolute that they are quite willing to impose them on reluctant countries through the so-called ‘governance-related conditionalities’ attached to multilateral and bilateral loans (for a critical review of this practice, see Kapur and Weber, 2000).
