Leveraging Financial Markets for Development

This book investigates how development institutions created and promoted marketized development financial instruments to increase the speed and scope of assistance by leveraging private financial markets for development objectives. To attract private investors, donor governments agreed to bear the risk in these new instruments in order to mobilize investment during times of political crisis. In particular, this book contends that Germany's KfW played an outsized role in the development of these new financial instruments, particularly in microfinance banks and structured funds, as KfW's unique institutional attributes and strong political support from the German government at critical junctures fostered financial innovation. Using over 70 interviews and a cache of newly released archival materials, this books documents how KfW and other development institutions created and promoted these marketized development financial instruments, and how they have become a pillar of modern development policy.

Argues that development institutions, and most notably Germany's KfW, have been at the forefront of integrating development policy with private financial markets Develops a synthesized framework to understand why development institutions have mobilized private finance, and why donor governments have been willing to absorb the risk in new financial instruments Provides the only independent scholarship of KfW and its role in global development finance, and documents other under-researched areas within development, including national development banks and World Bank-sponsored development finance companies

Auteur

Peter Volberding received his PhD from the Government Department at Harvard University, USA. His research focuses on the intersection between public institutions and private financial markets, and is co-author of a forthcoming edited volume on European development banking. He currently lives and works as a consultant in New York City.

Contenu

Chapter 1. The Marketization of Development Finance.- Chapter 2. 1950-1970: The World Bank, DFCs, and the Foundations of Private Investment Mobilization.- Chapter 3. 1970 to 1990: Development Finance in Crisis and the Search for a New Paradigm.- Chapter 4. KfW and the Early Stages of Marketized Development Financial Instruments. Chapter 5. Chapter 5: The Maturation of Marketized Development Financial Instruments: Microfinance and Structured Funds.- Chapter 6. The Scaling-Up of Marketized Development Financial Instruments from 2005 to 2017.- Chapter 7. Conclusion and Future Directions.