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From Structural Adjustment to “Poverty Reduction”

From Structural Adjustment to “Poverty Reduction”

Adjustment to the Crisis and the Crisis of Adjustment after 1980

(p.25) Chapter Two From Structural Adjustment to “Poverty Reduction”
Beyond the World Bank Agenda
Howard Stein
University of Chicago Press

This chapter traces the origins of structural adjustment, which has dominated the World Bank and IMF agendas since 1980. Structural adjustment lending in the Bank grew rapidly during the 1980s. Most donors of bilateral aid supported a similar agenda, thus placing enormous pressures on governments in developing countries to accept the policy packages. But in that decade the performance of countries subject to the adjustment program was quite dismal. To protect the integrity, resources, and reputation of the Bank, which had invested so much in adjustment, it was necessary to find a way to make it work. In the Bank's view, the problem was not that the policies of structural adjustment per se had failed but that other factors had limited the positive influence of neoliberal policies. After 1989 the Bank began to expand the agenda to incorporate governance ownership, social capital, legal reform, institutions, participation, and poverty reduction.

Keywords:   World Bank, structural adjustment, IMF, lending, bilateral aid, poverty reduction, governance ownership, social capital, legal reform

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