The development finance regime complex and crisis response: a comparative perspective of multilateral development banks’ response to COVID-19

Abstract This article explains variation in multilateral development banks’ (MDBs) crisis-response policies during the COVID-19 crisis. Drawing on a focused, structured comparison of 22 MDBs, this study analyzes five crisis-response policies: investment scale-ups and resource repurposing; institutional restructuring; fast-track facilities and procedures; policy and scope expansions; and inter-institutional collaboration and orchestration. It argues that MDBs’ crisis responses were shaped not only by institutional capacity but also by competitive pressures and hierarchical positioning within the development finance regime complex. MDBs occupying higher positions in the hierarchy demonstrated greater flexibility and were more likely to scale up lending, introduce expedited procedures, and expand operational scope, while lower-positioned MDBs adopted more cautious strategies and relied more heavily on cooperation with established MDBs. The analysis shows that some of this variation takes the form of patterned convergence in policy choices within hierarchical tiers and benchmarking practices across them, suggesting that hierarchy conditions both competition and coordination among MDBs during fast-moving crises and helps explain variation in countercyclical responses.