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Tutorial Assignment 1
Tutor name: Victoria
Student name and no: Ingavakula 2611359
Governance refers to the method and institutions by which a group or society makes and
implements decisions, creates laws and regulations, and governs its affairs. It includes the methods
and institutions that influence how authority is exercised and resources are allocated in a
community organisation, or on a larger societal scale (OHCHR, 2023).
From the start of WWII, British and American functionaries acknowledged the need for the reconstruction of
post war monetary structures, influenced by the difficulties observed in reconstruction after WWII. What
was realised was the need to create rules and understanding in order to lead post war national policies in the
direction of common objectives (Igwe, Isaac O.C, 2018, pg 111 ). Furthermore, in 1944, the Bretton Woods
agreement was established as an architecture for the postwar international economic order by implementing
three new bodies of the international financial system: The IMF; The World Bank; GATT, all together
known as the Bretton Woods system(454 B). This system depended on the stability of the American capital,
and the dominance of the United States I facilitating the maintenance of the system(Igwe, Isaac O.C, 2018,
pg 114).
The first two decades post WWII saw the longest period of structural economic growth the world economy
ever experienced. During this period, OECD members particularly, achieved consistent average growth rates
of 4-5 per cent a year. This was seen as a testament to the new stability created by the Bretton Woods system
as well as the benefits of its incorporation of the free trade, free capital movement and stable currencies. The
Bretton Woods institution including the Truman Doctrine would come to form an indirect system of
imperialism under the pan Americana, later becoming the foundation for a neo-colonial age which extended
until 1970.(Igwe, Isaac O.C, 2018, pg 117).Eventually, the long boom began to peter out in the late 1960s
which led to the stagflation of the 1970s. As a result, the USA abandoned the system of the fixed exchange
rates which effectively meant the end of the original Bretton Woods system. The institutions set up by the
Bretton Woods system did however survive the transition from fixed to floating exchange rates. The
economic stagnation of the 1970s also weakened and reversed the GATT’s progress in the reduction pf trade
barriers with industrialised countries particularly, pushing up so-called non-tariff barriers. A consequence
was growing resentment amongst developing countries paired with a recession which would lead the growth
in support for calls for a new international economic order. However any attempts to bring about this new
order were crushed. Instead, the institutions of global economic administration were reoriented around the
concepts of the so-called ‘Washington consensus’ in the 1980s. This effectively meant that an embedded
liberalism based system gave way to a neoliberalism based structure. (464, B)
Since the 1960s, financial and economic crises have occurred on a fairly regular basis, and they have gotten
more frequent and severe since the 1980s. (473, B). The global financial crisis of 2007-2009 posed a
sequence of deeper and more difficult obstacles, resulting in the most severe slump in the global economy
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since the Great Depression of the 1930s. It came as no surprise that urgent calls for reform of the Neo liberal
architecture of global economic governance would arise (475, B).
References
1. About good governance | OHCHR, accessed September 26, 2023, https://www.ohchr.org/en/goodgovernance/about-good-governance.https://www.ohchr.org/en/good-governance/about-goodgovernance#:~:text=Governance%20refers%20to%20all%20processes,to%20the%20process%20of%20
governing
2. Igwe, Isaac O.C. “History of the International Economy: The Bretton Woods System and Its Impact on the
Economic Development of Developing Countries.” Athens Journal of Law 4, no. 2 (2018): 105–26.
https://doi.org/10.30958/ajl.4.2.1.
https://heinonline.org/HOL/Page?handle=hein.journals/atnsj2018&div=14&g_sent=1&casa_token=&collecti
on=journals
3. Heywood, Andrew. “Chapter 19: Global Governance and the Bretton Woods System .” In Heywood A.
(Ed). In Global Politics. Houndmills, Basingstoke, Hampshire: Palgrave Macmillan, 2011.
https://d1wqtxts1xzle7.cloudfront.net/57575137/Palgrave_Foundations_Series_Andrew_Heywood-PoliticsPalgrave_Macmillan_2013-libre.pdf?1539692498=&response-contentdisposition=inline%3B+filename%3DPalgrave_Foundations_Series_Andrew_Heyw.pdf&Expires=1695732
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