%0 Book Section %T Inventing Conditionality, Exploring Its Politics (1946-1958) %+ Centre de recherches internationales (Sciences Po, CNRS) (CERI) %A Sgard, Jérôme %@ 978 1 83910 362 9 %B The Debt Crisis of the 1980s. Law and Political Economy %E Jérôme Sgard (Ed.) %I Edward Elgar Publishing %P 19 pages %8 2023 %D 2023 %K IMF %K conditionality %K debt crisis %Z Humanities and Social Sciences/Economics and Finance %Z Humanities and Social Sciences/History %Z Humanities and Social Sciences/Political scienceBook sections %X The conflict between Keynes and White, in the run-up to the 1944 Bretton Woods conference, left the IMF with a substantial capital, though without a rule-book on how to lend. The literature then insists on the introduction of the Stand-By Arrangement (1953), which remains till today the Fund’s workhorse lending vehicle. Yet, the literature ignores the second step of the re-invention: policy conditionality, hence the capacity for the IMF to suspend lending when countries diverge from their pre-agreed economic objectives. This book chapter analyzes this brake-through, in the case of a policy loans to Paraguay and Bolivia, in 1956-1958. It then shows how this innovation triggered within a few years: 1/ a redefinition of the IMF as a crisis manager, in an entirely novel relation to borrowing countries; 2/ a full realignment of the relationship between the staff, the management and the key member-states, primarily the US; 3/ the adoption of a new economic framework, known as the monetary approach to the balance of payment; 4/ in parallel, the exploration of the legal and political consequences of defining the Stand-By as a non-contractual transaction, adequate to a relation to self-standing sovereign states. %G English %2 https://sciencespo.hal.science/hal-04081478/document %2 https://sciencespo.hal.science/hal-04081478/file/2023_sgard_chapter_InventingConditionality_author.pdf %L hal-04081478 %U https://sciencespo.hal.science/hal-04081478 %~ SHS %~ SCIENCESPO %~ CNRS %~ AO-HISTOIRE %~ AO-ECONOMIE %~ HISTOIRE %~ AO-SCIENCEPOLITIQUE %~ CAMPUS-AAR %~ AAI %~ CERI %~ SCPO_OA %~ SCPO-REPEC