The Role of the Bank for International Settlements in the Global Financial Architecture: The Socialisation of Peripheral Countries

The aim of this thesis is to understand the role of the Bank for International Settlements (BIS) in the global financial architecture (GFA) for the integration of peripheral economies into global finance during the 1990s. Even though there has been increasing attention to and a surge in academic studies concerning the BIS, its relation to peripheral countries, as the BIS expanded its membership and incorporated several new members during the 1990s, has been overlooked. While this study seeks to unpack the increasing interaction of peripheral central bankers within the transnational networks of central bankers established through the BIS, it aims to fulfil two objectives: first, empirically understand the specific role played by the BIS for the articulation of peripheral economies into global finance and hence to highlight the special role of the BIS played in the GFA during the 1990s. Secondly, I aim to contribute theoretically to the study of global governance by employing a critical political economy approach, specifically transnational historical materialism. By unpacking the socialisation process of peripheral countries within the BIS, I aim to contribute to the transnational historical materialist explanations of the role of global governance mechanisms. I employ the concept of socialisation, which focuses on the role of ideas and power relations to understand the social and political function of global financial governance arrangements. The thesis aims to unpack micro-processes of socialisation of new members that lead to compliance with international financial standards and norms. To this end, the study uses expert interviews with high-level central bankers from country case studies of Chile, Turkey and Malaysia. These countries were selected as they represent different geographical locations, associated with distinct significant turning points in the history of global finance and global financial governance, as well as they show similar patterns of economic development. The extensive research on the BIS during the 1990s and the analysis of country case studies’ economic development during their increasing interaction with the BIS shows the BIS fulfils the function of socialisation of new member countries for the dissemination of a new understanding of central banking, identified with scientisation, financialisation and transnationalisation via social dynamics such as authority of central bankers and their expert knowledge; informal, technical and depoliticised functions of the BIS that exercise persuasion and peer pressure; as well as identity formation to create a sense of belonging. Country studies show that the BIS has been crucial in propagating central banking ideas to peripheral countries, and the conceptualisation of socialisation from a Gramscian perspective corroborates how it has unfolded for the central banks of Chile, Turkey and Malaysia.