The Development and Reform of the Modern International Financial System

Levy Economics Institute Working Paper No. 225

Posted: 5 Aug 1998

See all articles by L. Randall Wray

L. Randall Wray

University of Missouri at Kansas City; Bard College - The Levy Economics Institute

Date Written: 1998

Abstract

The international financial system might be said to be in crisis. It requires frequent intervention by central banks and other national and international bodies to reduce fluctuations of currencies. It does not tend to eliminate current account deficits and surpluses; exchange rate fluctuations do not lead to movements toward balanced trade, nor do they appear to follow from flows of international reserves: some countries run persistent surpluses while others run persistent deficits.

This paper first examines the functioning of the modern international financial system in order to design a reformed system that will make it to deal with some of the problems that face the international financial system today. The paper advocates reformation of the international financial system today. The paper advocates reformation of the international financial system along the lines of Keynes's famous bancor proposal. Most importantly, the reform would eliminate the current bias toward "austerity" that results from the way in which existing international financial institutions operate.

JEL Classification: F33, F42

Suggested Citation

Wray, L. Randall, The Development and Reform of the Modern International Financial System (1998). Levy Economics Institute Working Paper No. 225, Available at SSRN: https://ssrn.com/abstract=112628

L. Randall Wray (Contact Author)

University of Missouri at Kansas City ( email )

5100 Rockhill Road
Kansas City, MO 64110-2499
United States

Bard College - The Levy Economics Institute

Blithewood
Annandale-on-Hudson, NY 12504-5000
United States

Do you have negative results from your research you’d like to share?

Paper statistics

Abstract Views
743
PlumX Metrics