An essay on the revived bretton woods system
Michael P. Dooley,Michael P. Dooley,David Folkerts-Landau,David Folkerts-Landau,Peter M. Garber,Peter M. Garber +5 more
TLDR
The authors argue that the normal evolution of the international monetary system involves the emergence of a periphery for which the development strategy is export-led growth supported by undervalued exchange rates, capital controls and official capital outflows in the form of accumulation of reserve asset claims on the center country.Abstract:
The economic emergence of a fixed exchange rate periphery in Asia has reestablished the United States as the center country in the Bretton Woods international monetary system. We argue that the normal evolution of the international monetary system involves the emergence of a periphery for which the development strategy is export-led growth supported by undervalued exchange rates, capital controls and official capital outflows in the form of accumulation of reserve asset claims on the center country. The success of this strategy in fostering economic growth allows the periphery to graduate to the center. Financial liberalization, in turn, requires floating exchange rates among the center countries. But there is a line of countries waiting to follow the Europe of the 1950s/60s and Asia today sufficient to keep the system intact for the foreseeable future.read more
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International reserves: precautionary versus mercantilist views, theory and evidence
Joshua Aizenman,Jaewoo Lee +1 more
TL;DR: In this article, the importance of mercantilist and precautionary motives in accounting for the hoarding of international reserves by developing countries, and a model that quantifies the welfare gains from optimal management of international reserve is provided.
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Current account balances, financial development and institutions: Assaying the world “saving glut”
Menzie D. Chinn,Hiro Ito +1 more
TL;DR: The authors investigate the medium-term determinants of the current account using a model that controls for factors related to institutional development, with a goal of informing the recent debate over the existence and relevance of the savings glut.
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Explaining the global pattern of current account imbalances
Joseph W. Gruber,Steven B. Kamin +1 more
TL;DR: The authors assess some of the explanations that have been put forward for the global pattern of current account imbalances that has emerged in recent years, particularly the large U.S. current account deficit and the large surpluses of the Asian developing economies.
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The Missing Wealth of Nations: Are Europe and the U.S. net Debtors or net Creditors?
TL;DR: This article showed that official statistics substantially underestimate the net foreign asset positions of rich countries because they fail to capture most of the assets held by households in offshore tax havens, and provided concrete proposals to improve international investment statistics.
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Exchange Arrangements Entering the Twenty-First Century: Which Anchor will Hold?
TL;DR: This article provided a comprehensive history of anchor or reference currencies, exchange rate arrangements, and a new measure of foreign exchange restrictions for 194 countries and territories over 1946-2016, finding that the often cited post-Bretton Woods transition from fixed to flexible arrangements is overstated; regimes with limited flexibility remain in the majority.
References
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The East Asian Dollar Standard, Fear of Floating, and Original Sin
TL;DR: This article argued that the fear of floating is entirely rational from the perspective of each individual country and their joint pegging to the dollar benefits the East Asian dollar bloc as a whole, although Japan remains an important outlier.
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An Exploration in the Theory of Exchange-Rate Regimes
TL;DR: In this paper, three exchange-rate regimes (a float, a one-sided peg, and a cooperative peg) are evaluated and compared in terms of efficiency and welfare levels.
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Understanding interdependence : the macroeconomics of the open economy
TL;DR: The endogeneity of exchange-rate regimes has been studied in the context of the International Monetary System (IMS) Conference on Central and Eastern Europe (CES 2017).
ReportDOI
The Bretton Woods International Monetary System: An Historical Overview
TL;DR: An overview of the Bretton-woods experience can be found in this article, where the authors analyze its performance relative to other international monetary regimes and conclude that it was the most stable regime for nominal and real variables in the past century.