After Multilateralism: The US and the World Bank

Abstract

The Trump administration has been following an “America First” doctrine, and concern about the implications of this shift for the future of the Bretton Woods institutions is heightened. This article describes what is at stake and uses insights from the literature on the political economy of international financial institutions to speculate about the costs of a US exit from the World Bank – for the Bank, but also for the US. The World Bank relies on the US for funding as well as favorable credit ratings. However, the US also benefits from the World Bank much more than often appreciated, as numerous studies have shown patterns suggesting US influence over most aspects of World Bank lending. The World Bank thus provides the US with an alternative channel for foreign policy that has proven especially useful when standard bilateral options are too costly.