ECO342H1 Chapter Notes - Chapter 3: European Payments Union, Reserve Currency, Marshall Plan
Document Summary
Bretton woods: 1946-1958: bordo: analysed data from 1870 to 1995. Inflation, money supply growth, interest rates, changes in exchange rates were lowest in. Real per capita income growth greatest in bretton woods period gold standard and bretton woods periods: goal was stable prices and rapid growth, was inadequate by itself to correct balance of payments adjustments interventions in short-run. Marshall plan and european payments union arose to supplement imf currency. Countries often changed par values in long-run without consulting imf. Capital controls provided buffer against excessive balance of payments fluctuations: system was able to prevent contractionary consequences of balance of payments deficits in. Eliminates impediment of growth associated with gold standard: us has two-thirds of gold in 1945, europe cashed in most of international assets during war. Had limited capacity to export but needed capital goods: large balance of payments deficit with us ( billion in 1947, many to believe dollar shortage would be permanent, superior productivity of us.
