What does the international currency system really look like?

TLDR

Let's parse. Lines: 1. [Background] ABSTRACTThere has been a lot of debate lately about the shape of the international currency system. 2. [Background] Increasingly, we are told, the world is moving toward a multicurrency system with several poles, implying that the system is becoming more competitive.

Abstract

ABSTRACTThere has been a lot of debate lately about the shape of the international currency system. Increasingly, we are told, the world is moving toward a multicurrency system with several poles, implying that the system is becoming more competitive. Polarity, however, is a notoriously crude measure of the level of competition in any kind of system, economic or political. If analysis is to be at all accurate, it should take into account not only the number of poles in a system but also the inequalities among them –an alternative approach encompassed by the concept of concentration. In this paper we make use of the concept of concentration to provide a more accurate picture of the competitive structure of the currency system today. When taking account of concentration as well as polarity, our results suggest that the competitive structure of the system is little changed over a period stretching back more than two decades.KEYWORDS: International currencymulticurrency systemdollareuropolarityconcentration ACKNOWLEDGEMENTSWe would like to acknowledge helpful comments from two anonymous referees of the journal as well as David Andrews, Garrett Glasgow, Jonathan Kirshner, Edward Mansfield, Carla Norrlof, Miguel Otero-Iglesias, and Louis Pauly. An earlier version of this paper was presented at the annual meeting of the American Political Science Association, Chicago, IL, 29 August–1 September 2013.Notes1 As quoted in IMF Survey, 22 January 2001, p. 27.2 See Chen and Peng Citation(2010) and Lee Citation(2010).3 See Kamps Citation(2006), Goldberg and Tille Citation(2008) and Auboin Citation(2012).4 The COFER data can be accessed at: http://www.imf.org/external/np/sta/cofer/eng/index.htm.Additional informationNotes on contributorsBenjamin J. CohenBenjamin J. Cohen is Louis G. Lancaster Professor of International Political Economy at the University of California, Santa Barbara. He is the author of 13 books, including most recently The Future of Global Currency: The Euro versus the Dollar, published by Routledge in 2011.Tabitha M. BenneyTabitha M. Benney is an assistant professor of political science at the University of Utah in Salt Lake City. Her work has been published in Energy Policy and in Wiley Interdisciplinary Reviews.