The Limits to Central Bank Co-operation, 1916–36

1992 ◽  
Vol 1 (3) ◽  
pp. 259-279 ◽  
Author(s):  
Kenneth Mouré
Keyword(s):  
World War I ◽  
Central Bank ◽  
Gold Standard ◽  
International System ◽  
Central Banks ◽  
World War ◽  
Central Bankers ◽  
National Experience

Central bankers failed in their efforts to reconstruct the international gold standard on a durable basis after World War I. The gold-exchange standard did not unite them in a managed international system in the 1920s, and it perished with little regret in 1931. Stephen V. O. Clarke's monograph on central bank co-operation sees ‘considerable merit’ in the stabilisation efforts from 1924 to 1928, followed by failure to maintain the system from 1928 to 1931.1 Critics have pointed out with justice that co-operation was irregular before 1928, and that central banks continued to co-operate after 1931.2 Clarke recognizes that no conceivable improvements in central bank co-operation could have coped with the combination of political and economic convulsions in 1931; national goals necessarily took priority in central bank policies, and international objectives were determined by national experience and interest.3

scholarly journals The Bank For International Settlements: An Evolutionary Institution

2019 ◽  
Vol 15 (1) ◽  
pp. 19-28
Author(s):  
Michael P. Hughes ◽  
Chris Palke
Keyword(s):  
World War Ii ◽  
World War I ◽  
Central Bank ◽  
Financial Economic ◽  
Central Banks ◽  
Central Banking ◽  
Major Influence ◽  
World War ◽  
Bank For International Settlements ◽  
Financial Power

Established in 1930 in Basel, Switzerland, to expedite and supervise the payment of reparations by Germany to the victors of World War I, the Bank for International Settlements (BIS) quickly evolved into a banking establishment for various national central banks to negotiate and work out mutually-beneficial monetary policies and financial arrangements outside of the usual political and national channels. During World War II the BIS stayed open as a neutral central bank for central banks and provided significant back-channel communications between the Allied and Axis powers that could not have occurred any other way. As an example, discussions for the reconstruction of post-WWII Germany were underway between German and Allied representatives to the BIS at least two years prior to Germany’s surrender in May 1945. The post-WWII BIS then went on to become a global central bank for the world’s national central banks. In spite of the BIS holding so much effective financial power on an international scale and, hence, affecting nearly everyone in the world, few have ever heard of the BIS. This includes many economists and financial-economists. Why? Although technically not a secret organization, the BIS has always maintained an intentionally low profile. The BIS has never advertised its existence. It operates through many other organizations it has either directly created or where it holds major influence. This paper discusses the BIS, its history, and its impact and influence on world events. Questions concerning the role the BIS should possibly play in world events and central banking are raised for discussion near the end of this paper. This paper is focused primarily towards both upper-level undergraduate and graduate finance and economics courses, particularly in the areas of money, banking and financial institutions, financial markets, and monetary policy. However, other courses, to include those outside of the financial-economic arena, can find great use for this subject matter as well. Such outside arenas could include political science and history courses.

scholarly journals The hierarchical society: the politics of self-determination and the constitution of new states after 1919

2019 ◽  
Vol 26 (2) ◽  
pp. 372-396
Author(s):  
Maja Spanu
Keyword(s):  
World War I ◽  
International Relations ◽  
International Society ◽  
International System ◽  
World Politics ◽  
League Of Nations ◽  
Self Determination ◽  
World War ◽  
New States ◽  
History Of

International Relations scholarship disconnects the history of the so-called expansion of international society from the presence of hierarchies within it. In contrast, this article argues that these developments may in fact be premised on hierarchical arrangements whereby new states are subject to international tutelage as the price of acceptance to international society. It shows that hierarchies within international society are deeply entrenched with the politics of self-determination as international society expands. I substantiate this argument with primary and secondary material on the Minority Treaty provisions imposed on the new states in Central, Eastern and Southern Europe admitted to the League of Nations after World War I. The implications of this claim for International Relations scholarship are twofold. First, my argument contributes to debates on the making of the international system of states by showing that the process of expansion of international society is premised on hierarchy, among and within states. Second, it speaks to the growing body of scholarship on hierarchy in world politics by historicising where hierarchies come from, examining how diverse hierarchies are nested and intersect, and revealing how different actors navigate these hierarchies.

scholarly journals The UK-US Game and UK's Return to Gold Standard

2020 ◽  
Vol 5 (4) ◽  
pp. 324
Author(s):  
Zheming Zhang
Keyword(s):  
United States ◽  
World War Ii ◽  
World War I ◽  
Economic System ◽  
Gold Standard ◽  
International Economic Order ◽  
The United States ◽  
World War ◽  
The World ◽  
The Uk

<p>With the continuous development and evolution of the United States, especially the economic center shift after World War II, the United States become the economic hegemon instead of the UK and thus it seized the economic initiative of the world. After the World War I, the European countries gradually withdraw from the gold standard. In order to stabilize the world economy development and the international economic order, the United States prepared to build the economic system related with its own interests so as to force the UK to return to the gold standard. The game between the United States and the UK shows the significance of economic initiative. Among them, the outcome of the two countries in the fight of the financial system also demonstrates a significant change in the world economic system.</p>

The Fall

Money ◽  
2017 ◽  
Author(s):  
John Kenneth Galbraith ◽  
James K. Galbraith
Keyword(s):  
United States ◽  
New York ◽  
World War I ◽  
Gold Standard ◽  
Stock Exchange ◽  
The United States ◽  
World War ◽  
Industrial Countries ◽  
Monetary System ◽  
York Stock Exchange

This chapter examines the end of the international gold standard during World War I. The creation of the Federal Reserve System—with its idea of centralized banking carried out by twelve central banks—ended the United States's long struggle to perfect a sensible, conservative monetary system. Everywhere in the industrial countries money of whatever kind was now exchangeable, without pretense or delay, into gold. The chapter considers how the major industrial participants—Germany, France, Britain, Austria—suspended specie payments and went off the gold standard when World War I broke out; the dumping of securities on the New York market in the first nervous days of the war; the shutdown of the New York Stock Exchange; and how the United States eventually abandoned the gold standard. The increase in whole prices in the United States during all the war years is also discussed.

Putting the Program into Action, 1920–1928

2016 ◽  
Author(s):  
Simon James Bytheway ◽  
Mark Metzler
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Ad Hoc ◽  
Central Banks ◽  
Financial Globalization ◽  
International Network ◽  
Bank Of England ◽  
International Monetary Policy ◽  
Central Bankers

This chapter details how Montagu Norman of the Bank of England, in partnership with Benjamin Strong of the FRBNY, turned ad hoc wartime cooperation into a formal agenda. The paired ideas that national central banks should be autonomous, and that they should cooperate with each other, were first spelled out in a private “manifesto” that Norman circulated among fellow central bankers in 1921. Central bank cooperation was internationally recognized as a principle at the 1922 Genoa Conference, and it was also put into practice. Cooperation between central banks began primarily as informational cooperation, which includes not only the sharing of information but also the sharing and propagation of worldviews. An international network of central banks thus developed out of the war, as did the world's first truly coordinated system of international monetary policy. In these and other ways, financial globalization surged to a new level in the 1920s.

Does politics drive conflict in central banks’ committees? Lifting the veil on the European Central Bank consensus

2019 ◽  
Vol 21 (2) ◽  
pp. 183-203
Author(s):  
Manuela Moschella ◽  
Nicola M Diodati
Keyword(s):  
Central Bank ◽  
European Central Bank ◽  
Semantic Distance ◽  
Central Banks ◽  
Political Factors ◽  
Policy Positions ◽  
Projected Image ◽  
European Central ◽  
The Veil ◽  
Central Bankers

This study investigates whether and to what extent political factors drive disagreement within the allegedly consensual monetary committee of the European Central Bank. Absent voting data, the article assesses disagreement based on the semantic distance between the policy positions publicly articulated by the European Central Bank President and the central banks of Eurozone member states. The empirical analysis shows that the disagreement articulated by national central bankers is affected by the ideological inclinations of the governments of the countries they represent. Our findings thus suggest that central bankers’ position-taking is shaped not only by economic conditions but also by domestic political considerations. This result challenges the European Central Bank’s projected image of itself as an institution whose members are impermeable to domestic political pressures as a way to defend the independence of the institution to which they belong.

The Over-Burdened Central Bank and the Shift Away from Autonomy

2017 ◽  
Author(s):  
Pierre L. Siklos
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Financial Stability ◽  
Central Banks ◽  
Central Banking ◽  
Forward Guidance ◽  
Self Assessments ◽  
Crisis Conditions ◽  
Central Bankers ◽  
Influence Behavior

Many central banks took on additional responsibilities. Inadequate self-assessments remain unfinished almost a decade after the crisis erupted. Government-central bank relationships need to be conditioned on whether times are normal versus crisis conditions. Transparency confronts ambiguity when central banks must communicate the outlook and the conditionality of their decisions. Forward guidance was taken too far and ended up being futile. Central bankers simply exhausted their ability to influence behavior through mere words or ambiguous statements. This is a self-inflicted wound for institutions that are seen as overburdened. These forces leave central banking more vulnerable than is commonly acknowledged. Squaring the conventional objectives of monetary policy with the unclear aims of financial stability is difficult. Adequate limitations on the authority of central banks have yet to be thoroughly debated. We are nowhere near resolving the inherent tensions between old and new sets of central bank objectives.

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