Financial Decision-Making in MDBs: How Power Dictates Equitable Energy Financing

• In Event: International Collaboration on Economic Issues

Abstract

The study of energy politics often focuses on growing consumption rates and expanding a reliable energy supply to meet rising demand. More recently, the boundaries of the dominant energy-security paradigm have been expanded to incorporate complex ideas of inequality, well-being, and poverty. As part of this shift, Multilateral Development Banks (MDBs) remain a crucial actor due to their capacity to finance energy projects while also advancing broader goals of sustainable development. The bureaucratic politics that shape energy project financing decisions by MDBs remains poorly understood despite wider criticisms of inequitable funding. In this paper, I argue that inequitable energy financing is caused by power disparities among member states influencing decision-making of MDB officials. Not only can member states influence staff decisions through direct forms of pressure, but the interests of such powerful stakeholders can also be unconsciously accommodated by staff when allocating organizational resources. Empirically, I implement an elite paired conjoint experiment among officials from ten MDB institutions to mitigate social desirability biases and causally identify the effect of member states’ characteristics on energy financing distribution decisions. This paper thus contributes to research on energy politics, energy financing, and the bureaucratic politics of international organizations.

Author

• Mazie Bernard, Purdue University