Power and Discourse in Policy Diffusion: Anti-Money Laundering in Developing States

TLDR

Over the past two decades, AML policies have spread from none to more than 170 countries, despite little evidence of their effectiveness. The study asks why so many diverse developing countries adopted AML policies so quickly. The authors argue that AML diffusion in developing states is driven by power‑based mechanisms—direct coercion, mimicry, and competition—mediated through discourse rather than rational learning.

Abstract

Twenty years ago not a single country had a policy against money laundering; currently, over 170 have very similar anti-money laundering (AML) policies in place. Why have so many countries with so little in common adopted the same policy so rapidly? This extensive diffusion is particularly puzzling given the lack of evidence that AML policies actually work. In explaining the international spread of AML policies, this article draws on recent literature from International Relations, sociology, comparative politics, and public policy dealing with policy diffusion and policy transfer, but also differs from most of this work in two key aspects: First, it is argued that the process of diffusion in the developing world has been much more power-based than voluntary. Second, the mechanisms driving policy diffusion (direct coercion, mimicry, and competition) are all shown to be discursively mediated exercises of power, rather than reflecting rational learning or brute material forces. Evidence is drawn from surveys, interviews, and participant-observation in developing countries from three regions.