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/lp/de-gruyter/disequilibrium-in-the-international-balance-of-payments-gwgcEBiapA
- Publisher
- de Gruyter
- Copyright
- Copyright © 2012 by the
- ISSN
- 1145-6396
- eISSN
- 1145-6396
- DOI
- 10.1515/1145-6396.1253
- Publisher site
- See Article on Publisher Site
Abstract
Recent years have seen a problematic upward trend in disequilibrium in the international balance of payments. What accounts for this trend? Three hypotheses for the rise in disequilibrium are tested in this paper: greater fixedness of the world exchange rate regime causes greater disequilibrium; greater flexibility of the exchange rate regime causes greater disequilibrium; and a decline of United States economic hegemony causes greater disequilibrium. It is argued here that the problem was created by state choices, a lack of coordination among states in the international system, and the absence of an international exchange rate regime. The evidence presented in this paper supports the idea that a stable international exchange rate regime is critical to secure a healthy world economy.
Journal
Journal des Économistes et des Études Humaines – de Gruyter
Published: May 16, 2012