People, development and international financial institutions: an interpretation of the Bretton Woods system

It Is now fifty years since an inter‐governmental conference at the small American town of Bretton Woods set up two new institutions and agreed new ‘rules of the game’ for the governance of the international economic system. For many people, ‘fifty years is enough’ and there is an international debate about ways to reshape the governance of the international economic system so that it becomes more ‘people‐friendly’.

This article offers an interpretation of the Bretton Woods system and the mode of operation and of thinking characteristic of the two institutions whose job is to safeguard that system — the International Monetary Fund and the World Bank. The aim is not to offer a comprehensive and detailed discussion of the activities of the Fund and the Bank over the last fifty years, but rather to reflect on the ways in which concerns about human well‐being informed the setting up of the system and continue to inform its functioning fifty years later. In order to provide a framework in which to assess this dimension of the Bretton Woods system, we first consider ideas of people‐centred development and money‐centred development. We then consider the interplay of human well‐being and financial well‐being in the original process of setting up the Bretton Woods system, and in its functioning in the last fifteen years. Finally we raise the issue of redressing the balance between money and people.