The International Monetary Fund is one of the latest institutions to hop on the woke bandwagon.
Since the death of George Floyd, protests against racism and policy brutality have become a global trend.
In a recent piece, several IMF writers (Martin Čihák, Montfort Mlachila, and Ratna Sahay)
declared that the organization has a “moral duty to speak out against racism and discrimination.”
In addition, the authors highlighted how economists have “a professional duty—we need to expose how discrimination harms people’s livelihoods and economies, and how freeing the world of bias would also help address many of our economic challenges, to the benefit of all.”
For the IMF authors, economics has been plagued with discrimination and racism, which they observe below:
The field of economics has been far from immune from discrimination and racism. George Stigler, a 1982 Nobel laureate, argued in 1965 that Black people were inferior as workers and that the solution was in fostering “the willingness to work hard” (Stigler 1965). This was not an exception: it reflected biases of economists and economic institutions of the time. Indeed, as Howard University’s William Spriggs points out, economics has “a deep and painful set of roots that too few economists acknowledge” (Spriggs 2020).
In the IMF staff’s view, “economists still pay scant attention to race relative to other topics.”
Since the 1980s, the authors of this IMF paper argue that the field of economics has improved on the subject of race:
The economic debate has progressed since Stigler’s 1965 piece. Gary Becker, a 1992 Nobel laureate, demonstrated in his 1971 Economics of Discrimination that discrimination from several factors, including race, reduces the real income of both its target and the perpetrator. More recently, Harvard economist Raj Chetty and coauthors found that it is much harder for Black children in low-income US households to reach higher income brackets than for white children, and that environmental conditions, such as racial bias, account for this finding (Chetty and others 2020).
To truly defeat racism, the authors are of the opinion that the “first step is to create a safe environment to talk about racism, raise awareness, and provide mandatory bias training—including in those that are unconscious.”
Further, they called attention to how the IMF has been traditionally dominated by white males from Europe and the U.S., which is something they believe that the IMF can correct in the present:
As IMF staff members, we recognize that addressing biases begins at home. For more than half a century, men from Europe and the United States made up the majority of the IMF’s senior managerial positions. Starting in the mid-1990s, as efforts were made to promote diversity, we began to see some progress on improving the representation of women and staff from underrepresented regions such as East Asia, the Middle East, and sub-Saharan Africa. Since 2003, benchmarks have been set for gender and regional diversity. The regional benchmarks seek to broadly align the proportion of staff from a region with the financial contribution of the countries in the region to the IMF’s resources as well as the use of these resources by them. These benchmarks were not intended to address racial inequity, even if many consider them to be imperfect proxies for race. While we have achieved steady progress against these benchmarks, gaps remain in the shares of underrepresented staff and their promotions to managerial positions.
The authors concluded their piece with praise to the radical Black Lives Matter movement and a call for economists to fight discrimination and racism:
The Black Lives Matter movement has given a new impetus to raising awareness, learning, and empowerment. Research suggests that more economically inclusive organizations, cities, and societies tend to be more resilient and more prosperous. Economists have a role to play in the action for change to help build inclusive systems for the benefit of all—but first we must all, individually and collectively, look within.
The IMF, which already has a sketchy reputation for its economic advice, should stick to economics and not jump on the race-baiting bandwagon that has swept across America. If this organization were genuinely concerned about the plight of the Third World, they would be calling out central banking and pushing for market-based policies.
Sadly, they won’t because being politically correct is so much easier than giving tough advice in 2020.
The International Monetary Fund is one of the latest institutions to hop on the woke bandwagon.
Since the death of George Floyd, protests against racism and policy brutality have become a global trend.
In a recent piece, several IMF writers (Martin Čihák, Montfort Mlachila, and Ratna Sahay)
declared that the organization has a “moral duty to speak out against racism and discrimination.”
In addition, the authors highlighted how economists have “a professional duty—we need to expose how discrimination harms people’s livelihoods and economies, and how freeing the world of bias would also help address many of our economic challenges, to the benefit of all.”
For the IMF authors, economics has been plagued with discrimination and racism, which they observe below:
The field of economics has been far from immune from discrimination and racism. George Stigler, a 1982 Nobel laureate, argued in 1965 that Black people were inferior as workers and that the solution was in fostering “the willingness to work hard” (Stigler 1965). This was not an exception: it reflected biases of economists and economic institutions of the time. Indeed, as Howard University’s William Spriggs points out, economics has “a deep and painful set of roots that too few economists acknowledge” (Spriggs 2020).
In the IMF staff’s view, “economists still pay scant attention to race relative to other topics.”
Since the 1980s, the authors of this IMF paper argue that the field of economics has improved on the subject of race:
The economic debate has progressed since Stigler’s 1965 piece. Gary Becker, a 1992 Nobel laureate, demonstrated in his 1971 Economics of Discrimination that discrimination from several factors, including race, reduces the real income of both its target and the perpetrator. More recently, Harvard economist Raj Chetty and coauthors found that it is much harder for Black children in low-income US households to reach higher income brackets than for white children, and that environmental conditions, such as racial bias, account for this finding (Chetty and others 2020).
To truly defeat racism, the authors are of the opinion that the “first step is to create a safe environment to talk about racism, raise awareness, and provide mandatory bias training—including in those that are unconscious.”
Further, they called attention to how the IMF has been traditionally dominated by white males from Europe and the U.S., which is something they believe that the IMF can correct in the present:
As IMF staff members, we recognize that addressing biases begins at home. For more than half a century, men from Europe and the United States made up the majority of the IMF’s senior managerial positions. Starting in the mid-1990s, as efforts were made to promote diversity, we began to see some progress on improving the representation of women and staff from underrepresented regions such as East Asia, the Middle East, and sub-Saharan Africa. Since 2003, benchmarks have been set for gender and regional diversity. The regional benchmarks seek to broadly align the proportion of staff from a region with the financial contribution of the countries in the region to the IMF’s resources as well as the use of these resources by them. These benchmarks were not intended to address racial inequity, even if many consider them to be imperfect proxies for race. While we have achieved steady progress against these benchmarks, gaps remain in the shares of underrepresented staff and their promotions to managerial positions.
The authors concluded their piece with praise to the radical Black Lives Matter movement and a call for economists to fight discrimination and racism:
The Black Lives Matter movement has given a new impetus to raising awareness, learning, and empowerment. Research suggests that more economically inclusive organizations, cities, and societies tend to be more resilient and more prosperous. Economists have a role to play in the action for change to help build inclusive systems for the benefit of all—but first we must all, individually and collectively, look within.
The IMF, which already has a sketchy reputation for its economic advice, should stick to economics and not jump on the race-baiting bandwagon that has swept across America. If this organization were genuinely concerned about the plight of the Third World, they would be calling out central banking and pushing for market-based policies instead of trying to go woke.
Sadly, they won’t because being politically correct is so much easier than giving tough advice in 2020.
