U.S. International Monetary Policy

U.S. International Monetary Policy: Markets, Power, and Ideas as Sources of Change

Copyright Date: 1982
Pages: 406
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  • Book Info
    U.S. International Monetary Policy
    Book Description:

    This book proposes a new framework for explaining and anticipating foreign economic policy changes, at the same time providing a fascinating account of three American policy shifts that transformed the postwar international monetary system.

    Originally published in 1982.

    ThePrinceton Legacy Libraryuses the latest print-on-demand technology to again make available previously out-of-print books from the distinguished backlist of Princeton University Press. These paperback editions preserve the original texts of these important books while presenting them in durable paperback editions. The goal of the Princeton Legacy Library is to vastly increase access to the rich scholarly heritage found in the thousands of books published by Princeton University Press since its founding in 1905.

    eISBN: 978-1-4008-5629-9
    Subjects: Business

Table of Contents

  1. Front Matter
    (pp. i-vi)
  2. Table of Contents
    (pp. vii-viii)
    (pp. ix-ix)
    (pp. x-x)
    (pp. xi-xiii)
    (pp. xiv-4)
  7. 1 Introduction
    (pp. 5-14)

    THE international monetary system is to the world’s broader political-economic structure what a foundation is to a tall building. When the monetary system performs its functions effectively, it remains unnoticed by most of the inhabitants. But when the foundation begins to crumble or shake, it sends reverberations throughout the structure. The analogy is imperfect, since the monetary foundations of the world may be shifted substantially without destroying the structure, at least in principle. But the connotations are apt, since any effort to deal with monetary problems is delicate, raising always the ultimate possibility of toppling the entire edifice.

    The United...

  8. 2 Explaining Change in Foreign Economic Policy
    (pp. 15-78)

    THE facts of foreign economic policy will not organize themselves.¹ Commentators on them normally reach for one or two major conceptual tools for sifting through the evidence and identifying possible explanatory factors. Often, to no one’s surprise, the commentator finds that his or her chosen tool provides the best explanation, even though significant rival explanations were not even considered.

    For the serious observer, the challenge is to select and sharpen a few approaches that will identify key forces that move policies, and to ascertain which are more and less useful in analyzing concrete cases. Here let us consider five perspectives...

  9. 3 Creating a New International Money
    (pp. 79-164)

    ON 10 July 1965, Secretary of the Treasury Henry Fowler announced in a public speech in Hot Springs, Virginia, that the United States stood ready to participate in the first international monetary conference since Bretton Woods, for the purpose of reforming the world’s arrangements for providing international liquidity. Six months later, the U.S. government presented to the other major financial powers its plan for creating a new synthetic international reserve asset, a rival to the dollar. Fowler’s speech stunned the international financial world, since the United States had labored for several years on behalf of a balance-of-payments policy that would...

  10. 4 Going off Gold and Forcing Dollar Depreciation
    (pp. 165-291)

    ON Sunday evening, 15 August 1971, American television viewers watched one of the most stunning presidential addresses of recent years. From his desk in the Oval Office, President Richard Nixon proclaimed a “New Economic Policy,” suddenly embracing vigorously two policies that he and his predecessors had always just as vigorously denounced. On the domestic side, the administration was freezing wages and prices and was going to seek tax and spending reductions to spur the private sector to reduce unemployment. On the external side, the United States was going off gold.

    President Nixon began his address by declaring that national prosperity...

  11. 5 Farewell to Bretton Woods
    (pp. 292-343)

    A YEAR after the Smithsonian conference ended, the United States shifted course a third time, by taking the lead in multilateral bargaining over new monetary rules once again. In an address to the annual meeting of the International Monetary Fund in the fall of 1972, the Secretary of the Treasury announced the first high-level American proposal for negotiated changes in the international monetary regime since 1965. This American plan would have created a more flexible par value system within the Bretton Woods framework. United States representatives gave signs of serious intentions to compromise in order to achieve agreement within that...

  12. 6 Conclusions: Markets, Power, and Ideas
    (pp. 344-376)

    ON three occasions during the 1960s and 1970s, the United States changed its international monetary policies in ways that decisively altered the global monetary system. Judging from this period, the most powerful sources of change in American foreign monetary policy are international market conditions, the interstate military and economic power structure, and the circulation of policy ideas through Washington. An adequate explanation or forecast of U.S. policy content will require a combination of the three corresponding analytical perspectives. None of the more familiar approaches is adequate alone. Additionally, some influence, though clearly weaker, is felt on certain occasions from changing...

  13. INDEX
    (pp. 377-386)
  14. Back Matter
    (pp. 387-390)