Architecture of supra-governmental international financial regulation

Supra-governmental regulatory institutions (SNRs) resemble bridges that spa n gaps in the jurisdiction of individual-country regulators. The most impor tant bridges address cross-country problems of crisis management and develo pment finance not just as forums but as portfolio lenders as well. At portfolio SNRs, traditional cash-flow accounting supports incentives to overlend to countries undergoing crisis and to direct insufficient developm ent funds to the world's neediest countries. Better performance requires no t so much a structural streamlining of SNR missions as a realignment of the bureaucratic incentive systems under which SNR managers function. To accom plish this, reformers must focus on identifying economically meaningful ind exes of SNR achievement and experimenting with programs that link deferred managerial compensation at SNRs to sustained long-period movements in the s elected indexes.