IDEAS home Printed from https://ideas.repec.org/p/bog/wpaper/122.html
   My bibliography  Save this paper

The fatal flaw: the revived Bretton-woods system, liquidity creation, and commodity-price bubbles

Author

Listed:
  • Harris Dellas

    (University of Bern and CEPR)

  • George S. Tavlas

    (Bank of Greece)

Abstract

Dooley, Folkerts-Landau and Garber (DFG) argue that the present constellation of global exchange-rate arrangements constitutes a revived Bretton-Woods system. DFG ALSO argue that the revived system will be sustainable, despite its large global imbalances. We argue that, to the extent that the present system constitutes a revived Bretton-Woods system, it is vulnerable to the same set of destabilizing forces - - including asset price bubbles and global financial crises - - that led to the breakdown of the earlier regime.

Suggested Citation

  • Harris Dellas & George S. Tavlas, 2011. "The fatal flaw: the revived Bretton-woods system, liquidity creation, and commodity-price bubbles," Working Papers 122, Bank of Greece.
    • Handle: RePEc:bog:wpaper:122
    as

    Download full text from publisher

    File URL: http://www.bankofgreece.gr/BogEkdoseis/Paper2011122.pdf
    File Function: Full Text
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Barry Eichengreen & Peter Temin, 2010. "Fetters of gold and paper," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 26(3), pages 370-384, Autumn.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Michele Fratianni, 2012. "The Future International Monetary System: Dominant Currencies or Supranational Money? An Introduction," Open Economies Review, Springer, vol. 23(1), pages 1-12, February.
    2. Hansjörg HERR & Sina RÜDIGER & Jennifer Pédussel WU, 2016. "The Federal Reserve as Lender of Last Resort During the Subprime Crisis – Successful Stabilisation Without Structural Changes," Journal of Economics and Political Economy, KSP Journals, vol. 3(2), pages 192-210, June.
    3. Joshua Aizenman & Rajeswari Sengupta, 2011. "Global Imbalances: Is Germany the New China? A Skeptical View," Open Economies Review, Springer, vol. 22(3), pages 387-400, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Lucian Croitoru, 2018. "How Countries’ Different Attitudes towards Inflation can thwart the European Dream," Romanian Economic Journal, Department of International Business and Economics from the Academy of Economic Studies Bucharest, vol. 21(70), pages 2-41, December.
    2. Bruce N. Lehmann & David M. Modest, 1985. "The Empirical Foundations of the Arbitrage Pricing Theory I: The Empirical Tests," NBER Working Papers 1725, National Bureau of Economic Research, Inc.
    3. Nicholas Crafts & Peter Fearon, 2010. "Lessons from the 1930s Great Depression," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 26(3), pages 285-317, Autumn.
    4. Berbenni, Enrico, 2021. "External devaluation and trade balance in 1930s Italy," Structural Change and Economic Dynamics, Elsevier, vol. 57(C), pages 93-107.
    5. Bordo, Michael & James, Harold, 2014. "The European Crisis in the Context of the History of Previous Financial Crises," Journal of Macroeconomics, Elsevier, vol. 39(PB), pages 275-284.
    6. Roldan Alba, 2022. "The Golden Fetters in the Mediterranean Periphery. How Spain and Italy Overcame Business Cycles Between 1870 and 1913?," Economics - The Open-Access, Open-Assessment Journal, De Gruyter, vol. 16(1), pages 170-193, January.
    7. Elmas Yaldiz Hanedar & Avni Önder Hanedar & Ferdi Çelikay, 2017. "Effects of reforms and supervisory organizations: Evidence from the Ottoman Empire and the Istanbul bourse," Working Papers 0112, European Historical Economics Society (EHES).
    8. Deborah Mabbett & Waltraud Schelkle, 2015. "What difference does Euro membership make to stabilization? The political economy of international monetary systems revisited," Review of International Political Economy, Taylor & Francis Journals, vol. 22(3), pages 508-534, June.
    9. Alan de Bromhead & Kevin Hjortshøj O'Rourke, 2024. "Should history change the way we think about populism?," Economic History Review, Economic History Society, vol. 77(3), pages 1086-1109, August.
    10. Pierre-Olivier Gourinchas & Maurice Obstfeld, 2012. "Stories of the Twentieth Century for the Twenty-First," American Economic Journal: Macroeconomics, American Economic Association, vol. 4(1), pages 226-265, January.
    11. George Chouliarakis & Sophia Lazaretou, 2014. "Deja vu? The Greek crisis experience, the 2010s versus the 1930s. Lessons from history," Working Papers 176, Bank of Greece.
    12. Spahn Peter, 2012. "Diskussionsbeitrag / Discussion. Paper David Hume und die Target-Salden," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 232(4), pages 482-488, August.
    13. Valentini, Enzo & Arlotti, Marco & Compagnucci, Fabiano & Gentili, Andrea & Muratore, Fabrizio & Gallegati, Mauro, 2017. "Technical change, sectoral dislocation and barriers to labor mobility: Factors behind the great recession," Journal of Economic Dynamics and Control, Elsevier, vol. 81(C), pages 187-215.
    14. Alogoskoufis, George & Gravas, Konstantinos & Jacque, Laurent, 2023. "Asymmetries in post-war monetary arrangements in Europe: From Bretton Woods to the Euro Area," The Journal of Economic Asymmetries, Elsevier, vol. 28(C).
    15. Crescioli, Tommaso & Martelli, Angelo, 2022. "Beyond the Great Reversal: Superstars, Unions, and the Euro," Single Market Economics Papers WP2022/8, Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs (European Commission), Chief Economist Team.
    16. Benczes, István, 2018. "Az euróövezet válságrendezése a liberális kormányköziség elméletének értelmezésében [Crisis management in the Euro Zone from the perspective of liberal inter-governmentalism]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(9), pages 923-948.
    17. Willem THORBECKE, 2010. "The Appropriate Policy Mix for China," Policy Discussion Papers 10002, Research Institute of Economy, Trade and Industry (RIETI).
    18. Chen, Yao & Ward, Felix, 2019. "When do fixed exchange rates work? Evidence from the Gold Standard," Journal of International Economics, Elsevier, vol. 116(C), pages 158-172.
    19. Sabaté, Marcela & Fillat, Carmen & Escario, Regina, 2019. "Budget deficits and money creation: Exploring their relation before Bretton Woods," Explorations in Economic History, Elsevier, vol. 72(C), pages 38-56.
    20. Javier Bilbao‐Ubillos & Ana‐Isabel Fernández‐Sainz, 2022. "The results of internal devaluation policy as a crisis exit strategy: The case of Spain," Global Policy, London School of Economics and Political Science, vol. 13(5), pages 767-781, November.

    More about this item

    Keywords

    Bretton-Woods system; international liquidity; price bubbles; Markov switching model;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
    • N10 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - General, International, or Comparative

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bog:wpaper:122. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Anastasios Rizos (email available below). General contact details of provider: https://edirc.repec.org/data/boggvgr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.