Senior Honors Theses
History Department Honors Program

Document Type

Thesis or dissertation

Date of this Version

3-31-2022

Abstract

This thesis examines the Jamaican financial crisis which began in the mid-1990s and lasted until approximately the turn of the 21st century. It explores the role of Jamaica’s longer-term economic trajectory in causing the crisis – specifically, its relationship with the International Monetary Fund and the World Bank. After experiencing a balance of payments crisis in 1977, Jamaica sought financial assistance from the IMF. The policies implemented as part of this assistance program wreaked economic havoc in Jamaica and led the government to implement policies that ultimately resulted in the collapse of Jamaica’s financial sector. Scholars over time have focused on shorter-term causes of the crisis such as insufficient financial regulation, poor macroeconomic policymaking by politicians, and mismanagement of financial institutions. From the examination of newspaper archives, government documents, IMF publications, and secondary sources, it is evident that the financial crisis of the 1990s was driven in large part by the longer-term trajectory of the Jamaican economy. This longer-term period was characterized primarily by the policies implemented by the IMF throughout the late 1970s, the 1980s, and the early 1990s. This thesis finds that the IMF’s policies led to a shift in the focus of the government’s economic policies from earning foreign exchange to accessing foreign exchange. This inappropriate focus ultimately resulted in the liberalization of the foreign exchange regime in 1991, which caused the crisis of the mid-1990s.

Keywords

jamaica, finance, economics, economic history, financial crisis, multilateral development bank, multilateral financial institution, developing nation, imf, world bank, history

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Date Posted:31 March 2022