The Institutional Roots of Incremental Ideational Change: The IMF and Capital Controls after the Global Financial Crisis

Research Highlights and Abstract

This article

Contributes to the literature on ideational change by bringing to the surface an incremental ideational dynamic after major crises that differs from the well-known punctuated dynamic;

Although much scholarly attention has been devoted to examining the punctuated dynamics of ideational change, other dynamics exist. Ideational change may well occur incrementally in ordinary times or, as this study shows, can also materialise after a major shock, such as a financial and economic crisis. By examining the IMF's new approach to capital controls in the aftermath of the global financial crisis, the article demonstrates that the non-punctuated nature of ideational change can be explained in light of the enabling (and not solely constraining) features of the institutional context in which actors operate. Rather than preventing change until an explosion of radical change occurs, institutional frictions may also allow for successive adjustments over time. They may in fact allow for a gradual release of pressure, thereby preventing the impending explosion.