Evaluation And Optimization Of The IMF Quota Formula

As one of the three pillar institutions of the global economy, IMF has received widespread concerns upon its development. With the recent advancement of economic globalization and diversification, as well as the financial crisis breaking out frequently, the international community is about to put forward higher requirements and demand for the functions of IMF, which lead the reform of IMF extremely urgent.Among all aspects of the reform, the most important is the one that deals with the internal governance, which reflect the voice of members and operational efficiency of IMF. In the internal governance reform, the distribution of the quota share is critical. It involves the stake of each member country in IMF and the current monetary system, and is the key factor to further enhance the international status and influence of IMF. Thus, Quota Formula Review Group was set up by IMF to evaluate and revise the formula. At first in this paper, the development of IMF was introduced, the necessity of its existence was discussed and the suggestions for the reform were overviewed. Then, based on the research of QFRG, two sets of evaluation model of quota distribution formula were established, and a variety of schemes were discussed to optimize the QFRG formula. From the perspective of the reality, as well as taking into account the theoretical basis, the optimal results of quota formula were derived under each evaluation model, using the method of calculation experiment. Finally in the paper, the proposed evaluation criteria and the final results were discussed, and shortcomings were summarized for further research in future.