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2013 | OriginalPaper | Buchkapitel

6. Benign Neglect of Dollar: The Bretton Woods and Its Demise

verfasst von : Satyendra Nayak

Erschienen in: The Global Financial Crisis

Verlag: Springer India

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Abstract

In order to understand the present financial crisis in a longer perspective, it is essential to look at and realize the systemic changes both in the USA and the global economy over the last century. The postwar economic prosperity presented a sharp contrast to the economic devastation of the earlier period of two world wars. Against this backdrop, the new global economic and monetary system was built at the Bretton Woods summit in New Hampshire in 1944, where financial experts, economists, and policy makers from all nations had gathered to create a framework for establishing a new global economic order for sustained and broad-based economic growth based on mutually advantageous trade and investments and stable international monetary system. The new system based on cooperation and accommodation, rather than hostility, conflict, retaliatory politics, and economic policies emanating primarily from political and economic rivalries, paved the way for uninterrupted economic progress for more than two and a half decades until 1971. This era of economic growth and tranquility of the 1950s and 1960s could not be sustained further by the Bretton Woods Framework. By the beginning of the 1970s, the postwar global economic architecture was showing the signs of weakness under the stress of demands for sustainable global growth and its more equitable sharing among the nations.

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Fußnoten
1
Prof. Gottfried Haberler was the chief architect of the theoretical exposition of this policy which he developed with Thomas Willett. But it was also simultaneously but independently put forward by Lawrence Krause.
 
2
Professor Brahmananda predicted the imminent collapse of gold–dollar standard in 1969 when he analyzed the growing rift between US external liquid liabilities and value of its gold stocks potentially rocking monetary system.
 
3
Bank for International Settlement, Forty Second Annual Report, 1971–1972, Basle, June, 1972, p. 6.
 
4
Schumpeter, Joseph, The March into Socialism, Address before the Annual Meeting of American Economic Association, at New York, December 30, 1949.
 
Literatur
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2.
Zurück zum Zitat Haberler G, Willett TA. Strategy for US balance of payments. Washington, DC: American Enterprise Institute; 1971. Haberler G, Willett TA. Strategy for US balance of payments. Washington, DC: American Enterprise Institute; 1971.
3.
Zurück zum Zitat Haberler G. US balance of payments policy and the international monetary system. In: Schultz W, editor. Convertibility, multilateralism and freedom. World economic policy in the seventies, essays in honor of Reinhard Kamitz. Wein/New York: Springer; 1972. p. 177–8.CrossRef Haberler G. US balance of payments policy and the international monetary system. In: Schultz W, editor. Convertibility, multilateralism and freedom. World economic policy in the seventies, essays in honor of Reinhard Kamitz. Wein/New York: Springer; 1972. p. 177–8.CrossRef
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Zurück zum Zitat Brahmananda PR. Gold-money rift. Bombay: Vora Publications; 1969. Brahmananda PR. Gold-money rift. Bombay: Vora Publications; 1969.
5.
Zurück zum Zitat Despres E, Meier GM. A proposal for strengthening the dollar. In: International economic reform – collected papers of Emile Despres. New York: Oxford University Press; 1973. Despres E, Meier GM. A proposal for strengthening the dollar. In: International economic reform – collected papers of Emile Despres. New York: Oxford University Press; 1973.
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Zurück zum Zitat Houthhakker HS, Magee SP. Income and price elasticities in world trade. Rev Econ Stat. 1969;LI(2):111–25.CrossRef Houthhakker HS, Magee SP. Income and price elasticities in world trade. Rev Econ Stat. 1969;LI(2):111–25.CrossRef
Metadaten
Titel
Benign Neglect of Dollar: The Bretton Woods and Its Demise
verfasst von
Satyendra Nayak
Copyright-Jahr
2013
Verlag
Springer India
DOI
https://doi.org/10.1007/978-81-322-0798-6_6