The real cost of the external debt for the creditor and for the debtor

Includes bibliography

External financing in Latin America: developments, problems and options

Includes bibliography

The adjustment process in the 1980s: the need for a global approach

Includes bibliography

Euro and the financial relations between Latin America and Europe: medium- and long-term implications

Includes bibliography

Capital movements and external financing

Includes bibliography

Did Impending War in Europe Help Destroy the Gold Bloc in 1936? An Internal Inconsistency Hypothesis

This paper investigates the gold bloc operated between France, the Netherlands, Switzerland and Belgium, especially over the period after the USA left the gold standard in March 1933 to its end in September 1936. It enquires into the effect of military-political developments in Germany and Italy on the sustainability of the gold bloc between its members. Juxtaposed is the view of leading political scientists, such as Henry Kissinger, who see impending war in Europe as deeply and adversely affecting psychology in Europe, and what may be called the standard "economists' view" that sees the demise of the gold bloc as being caused almost exclusively by economic factors. Developing concepts of external and internal inconsistency of the gold bloc, this investigation concludes that both economic and military-political developments played important roles in destroying the last vestiges of the gold standard.

Global and regional financial safety nets: lessons from Europe and Asia. Bruegel Working Paper 2013/06 [07?], November 2013

The Asian financial crisis (1997) and the European crisis (2009) have both contributed to the development and deepening of regional safety net arrangements. This paper analyses the relationships between global and regional financial safety nets, and uncovers the potential tensions and operational challenges associated with the involvement of several institutional players with potentially different interests, analytical biases and governance. The G20 has acknowledged the importance of these new players for the international monetary system, but the principles for cooperation between the IMF and regional financing arrangements are far too broad and ad hoc to contribute to a coherent and effective architecture. This paper tries to establish some lessons learned from the Asian financial crisis in 1997 and the current European crisis in order to enhance the effectiveness, efficiency, equity and governance of these arrangements. In particular, it proposes changes to the IMF articles of agreement to allow for lending or guarantees to regional arrangements directly and it establishes some key desirable features and practices of regional mechanisms that should be adopted everywhere to ensure some global consistency, particularly in the field of macroeconomic surveillance, programme design and conditionality.

The threat of "currency wars": A European perspective

The ‘currency war’, as it has become known, has three aspects: 1) the inflexible pegs of undervalued currencies; 2) recent attempts by floating exchange-rate countries to resist currency appreciation; 3) quantitative easing. Europe should primarily be concerned about the first issue, which relates to the renewed debate about the international monetary system. The attempts of floating exchange-rate countries to resist currency appreciation are generally justified while China retains a peg. Quantitative easing cannot be deemed a ‘beggar-thy-neighbour’ policy as long as the Fed’s policy is geared towards price stability. Current US inflationary expectations are at historically low levels. Central banks should come to an agreement about the definition of price stability at a time of deflationary pressures. The euro’s exchange rate has not been greatly impacted by the recent currency war; the euro continues to be overvalued, but less than before.

Megmenthető-e az euróövezet? (Can the eurozone be saved?)

Az euró válságának szélesebb globális összefüggései vannak, mind a kiváltó okait, mind a nemzetközi pénzügyi rendszer működésének hiányosságait illetően. Az európai monetáris integráció szilárd reálgazdasági alapokon nyugszik. Az euró teljesítménye mind az árstabilitás, mind az árfolyamok ingadozása tekintetében megfelelőnek tekinthető. Az euróválság szuverénadósság-válság, és leginkább a zóna egyes (déli) országait érinti. Az euróválság okai többrétűek: ezek között az eurózóna hibás konstrukcióját, téves koncepcionális feltételezéseit, a politikai kompromisszumokkal folyamatosan megnyomorított működését említhetjük leginkább. A közös pénz önmagában nem oka a válságnak és nem is bűvös ellenszer. A hibás gazdaságpolitikáért belül ugyanúgy bűnhődni kell, mint kívül. Görögország, vagy Írország elsősorban nem azért került válságba, mert tagjai az eurózónának, hanem mert hibás gazdaságpolitikát folytattak. Nem zárható ki az eurózóna szétesése, de kicsi az esélye. / === / The euro crisis has broad global connections, both in terms of deficiencies of the international monetary system, and of the crisis of the global financial markets. The European monetary integration is based on strong real-economic foundations. The performance of the euro has been satisfactory both in terms of price and exchange rate stability. The present crisis is a sovereign debt crisis, and it is concentrated mainly on some Southern members. The causes of the crisis are manifold: wrong institutional and policy structures, mistaken conceptual assumptions, and the distortion of its operation by continuous political compromises. The contradictions between common monetary policy and the national fiscal policies, the failure of disciplining role of the markets, the weakness of control of national fiscal policies, the dangers of "one size fits all" monetary policy, the failure of finding the proper national policy mixes, particularly in terms of income and structural policies, and the underestimation of social and cultural differences, can be particularly stressed. The common monetary policy failed to secure the necessary equilibrium among liquidity, stability and growth. Greece and Ireland got in crisis not because they are members of the euro zone, but because of their mistaken economic policies. The collapse of the euro zone cannot be excluded, but the chances of it are limited.

La política económica de la República Popular China: un desafío a la hegemonía monetaria de los Estados Unidos en el Sudeste Asiático. Periodo 2003 -2015

La presente investigación parte del declive de la hegemonía de los Estados Unidos y el paralelo asenso económico de la República Popular China en las últimas décadas. De este modo, se plantea como objetivo principal analizar cómo China mediante su política económica desafía a la hegemonía monetaria de los Estado Unidos en el Sudeste Asiático, durante el periodo de 2003 a 2015. Con el fin de lograr este objetivo, se elabora un estudio de la hegemonía de los Estados Unidos y sus dinámicas en el Sudeste Asiático. Asimismo, se analiza la política económica de la República Popular China y su incidencia frente a la hegemonía estadounidense en el Sudeste Asiático.

European payment system and monetary union

We make a comparative study of payment systems for E.U. -fifteen countries for the 1996-2002 period. Special attention is paid to the introduction of the new European single currency. The overall trend in payments is for a move from cash to noncash payment instruments, although electronic instruments are not widely used yet. We find a significant impact from the introduction of the new banknotes and coins on card use

Emerging markets and the international financial architecture: a blueprint for reform

If emerging markets are to achieve their objective of joining the ranks of industrialized, developed countries, they must use their economic and political influence to support radical change in the international financial system. This working paper recommends John Maynard Keynes's "clearing union" as a blueprint for reform of the international financial architecture that could address emerging market grievances more effectively than current approaches. Keynes's proposal for the postwar international system sought to remedy some of the same problems currently facing emerging market economies. It was based on the idea that financial stability was predicated on a balance between imports and exports over time, with any divergence from balance providing automatic financing of the debit countries by the creditor countries via a global clearinghouse or settlement system for trade and payments on current account. This eliminated national currency payments for imports and exports; countries received credits or debits in a notional unit of account fixed to national currency. Since the unit of account could not be traded, bought, or sold, it would not be an international reserve currency. The credits with the clearinghouse could only be used to offset debits by buying imports, and if not used for this purpose they would eventually be extinguished; hence the burden of adjustment would be shared equally - credit generated by surpluses would have to be used to buy imports from the countries with debit balances. Emerging market economies could improve upon current schemes for regionally governed financial institutions by using this proposal as a template for the creation of regional clearing unions using a notional unit of account.

European payment system and monetary union

We make a comparative study of payment systems for E.U. -fifteen countries for the 1996-2002 period. Special attention is paid to the introduction of the new European single currency. The overall trend in payments is for a move from cash to noncash payment instruments, although electronic instruments are not widely used yet. We find a significant impact from the introduction of the new banknotes and coins on card use

Monetary Systems in Developing Countries: An Unorthodox View

This paper analyzes some recent theoretical and practical evidence in terms of economic results of different exchange rate systems. It begins with a historical review and a summary of fixed versus flexible exchange rate systems. Then it compares the experiences of recent currency unions, mostly unilateral, and their relative economic performance during the past currency crises in Latin America, East Asia and Eastern Europe. A set of issues is discussed in order to weigh the overall costs and benefits for several economies. These issues include exchange rates, GDP performance, inflation rates and foreign reserves. The case of Argentina is also considered separately, comparing mostly seigniorage costs and interest-rate savings. The benefits and costs of the producers (central banks/governments) and the consumers (citizens) of money are discussed separately. Free banking is also considered in a fast-changing world where there will probably be fewer but better currencies. Not just the euro is a reality now, but maybe the "amero" and the "worldo" or the "mondo" very soon.

A unified framework of trade in value added : physical, monetary, exchange rates, and GHG emissions

Koopman et al. (2014) developed a method to consistently decompose gross exports in value-added terms that accommodate infinite repercussions of international and inter-sector transactions. This provides a better understanding of trade in value added in global value chains than does the conventional gross exports method, which is affected by double-counting problems. However, the new framework is based on monetary input--output (IO) tables and cannot distinguish prices from quantities; thus, it is unable to consider financial adjustments through the exchange market. In this paper, we propose a framework based on a physical IO system, characterized by its linear programming equivalent that can clarify the various complexities relevant to the existing indicators and is proved to be consistent with Koopman's results when the physical decompositions are evaluated in monetary terms. While international monetary tables are typically described in current U.S. dollars, the physical framework can elucidate the impact of price adjustments through the exchange market. An iterative procedure to calculate the exchange rates is proposed, and we also show that the physical framework is also convenient for considering indicators associated with greenhouse gas (GHG) emissions.