The Gold Standard in Theory and History

Since the successful first edition of The Gold Standard in Theory and History was published in 1985, much new research has been completed. This updated version contains five new essays including: * post 1990 literature on exchange rate target zones * a discussion of the light shed by the gold standard on the European Monetary Union debate * a new introduction by Eichengreen with Marc Flandreau This will be an invaluable resource for students of macroeconomics, international economics and economic history at all levels. Book Cover......Page 1 Half-Title......Page 2 Title......Page 3 Copyright......Page 4 Dedication......Page 5 Contents......Page 6 Preface and Acknowledgements......Page 8 1 Editors’ introduction......Page 9 The emergence of the international gold standard......Page 11 Forms of the gold standard......Page 13 Exchange rates under the gold standard......Page 14 The efficiency view......Page 15 The discipline view......Page 17 The modern synthesis: the gold standard as a credible target zone......Page 18 The roots of credibility......Page 20 From the prewar gold standard to the interwar gold exchange standard......Page 21 The Bretton Woods gold-dollar standard and after......Page 24 Notes......Page 25 References......Page 27 Part I The gold standard in theory......Page 30 Introduction......Page 31 2 On the balance of trade......Page 32 Notes......Page 38 3 The working of the prewar gold standard......Page 39 Notes......Page 47 The monetary theory and its implications for the gold standard......Page 48 Did international markets work well?......Page 50 Money, gold and the balance of payments......Page 54 Notes......Page 58 References......Page 60 5 A portfolio-balance model of the gold standard*......Page 62 A portfolio theoretic interpretation......Page 63 The Canadian price level and balance of trade......Page 64 Canadian asset equilibrium under the gold standard......Page 66 The portfolio theoretic reinterpretation of the Canadian evidence......Page 68 Conclusions......Page 72 Data appendix......Page 73 Notes......Page 74 References......Page 75 Introduction......Page 78 The gold standard as a contingent rule......Page 79 An international rule......Page 82 Inflation persistence......Page 83 Credibility bands......Page 85 Access to foreign capital as a commitment mechanism by peripheral countries......Page 86 The behavior of interest rates and exchange rates during suspension periods......Page 88 The pattern of shares of finance in government expenditure during wartime......Page 90 Revenue smoothing......Page 91 Suggestions for future research......Page 92 The lessons from history......Page 93 Notes......Page 95 References......Page 97 Part II The gold standard in history......Page 101 Introduction......Page 102 7 The significance of the gold points......Page 103 Notes......Page 108 Textbook abstract......Page 109 Historical abstract......Page 110 Reinterpretation and conclusions......Page 113 A gentle reminder of the apostles of gold money......Page 115 Monetary expansion and international reserves before World War I......Page 118 Notes......Page 122 References......Page 123 9 Notes on the working of the gold standard before 1914......Page 124 Notes......Page 140 References......Page 142 10 The gold standard since Alec Ford......Page 143 Notes on the working of the gold standard before 19144......Page 144 Statistical analysis......Page 145 Interpretation......Page 153 Conclusion......Page 155 References......Page 156 A fixed-rate international monetary system: description, definitions, and analysis......Page 158 The rise of the gold standard: international dynamics......Page 161 The rise and reign of gold: domestic-international dynamics......Page 164 Notes......Page 169 Part III The interwar gold exchange standard......Page 172 Introduction......Page 173 Introduction......Page 174 Notes......Page 183 The international gold standard......Page 185 Primary objective of the gold standard......Page 186 Secondary objectives of the gold standard......Page 187 Conditions necessary for the working of the gold standard......Page 188 The recent working of the gold standard......Page 189 The question of an international standard......Page 191 Devaluation......Page 192 The prospects of the gold standard......Page 193 Note......Page 195 The recommendations of the Genoa Conference......Page 196 Prewar antecedents of the gold exchange standard......Page 197 Modification of central bank statutes......Page 198 Sources of central banks’ exchange holdings......Page 199 Fluctuations in foreign-exchange reserves prior to 1931......Page 200 France on the gold exchange standard......Page 202 The breakdown of the gold exchange standard......Page 204 Merits and defects of the system......Page 206 Notes......Page 213 References......Page 214 Part IV Bretton Woods and after......Page 215 Introduction......Page 216 The gold-dollar system......Page 217 Reserves......Page 218 The adjustment process: countries in deficit......Page 223 The adjustment process: countries in surplus......Page 226 Deterioriation of the system......Page 230 Note......Page 231 Introduction......Page 232 The role of capital controls......Page 233 Post-war reconstruction and Bretton Woods......Page 235 Implications for international monetary reform 13......Page 236 Currency boards......Page 237 Target zones......Page 238 A Tobin tax......Page 239 Notes......Page 240 References......Page 241 Further reading......Page 243 References......Page 244 Index......Page 247 Preface And Acknowledgements -- 1. Editors' Introduction -- Pt. I. The Gold Standard In Theory -- 2. On The Balance Of Trade -- 3. The Working Of The Prewar Gold Standard -- 4. How The Gold Standard Worked, 1880-1913 -- 5. A Portfolio-balance Model Of The Gold Standard -- 6. The Gold Standard As A Rule -- Pt. Ii. The Gold Standard In History -- 7. The Significance Of The Gold Points -- 8. The Myth And Realities Of The So-called Gold Standard -- 9. Notes On The Working Of The Gold Standard Before 1914 -- 10. The Gold Standard Since Alec Ford -- 11. The Dynamics Of International Monetary Systems: International And Domestic Factors In The Rise, Reign, And Demise Of The Classical Gold Standard -- Pt. Iii. The Interwar Gold Exchange Standard -- 12. First Interim Report -- 13. Report -- 14. The Gold Exchange Standard -- Pt. Iv. Bretton Woods And After -- 15. The Gold-dollar System: Conditions Of Equilibrium And The Price Of Gold -- 16. The Bretton Woods System: Paradise Lost? -- Further Reading -- Index. Edited By Barry Eichengreen And Marc Flandreau. Includes Bibliographical References And Index. Annotation Since the successful first edition of The Gold Standard in Theory and Historywas published in 1985, much new research has been completed. This updated version contains five new essays including:* post 1990 literature on exchange rate target zones* a discussion of the light shed by the gold standard on the European Monetary Union debate* a new introduction by Eichengreen with Marc FlandreauThis will be an invaluable resource for students of macroeconomics, international economics and economic history at all levels Since the first edition, published in 1985, much new research has been completed. This updated version includes five new essays, including a new introduction by Eichengreen and a discussion of the gold standard and the EU monetary debate.