Money and the International Monetary System: Origins and Evolution

Giovanni Battista Pittaluga and Elena Seghezza
Additional contact information
Giovanni Battista Pittaluga: University of Genoa
Elena Seghezza: University of Genoa

Chapter Chapter 2 in Building Trust in the International Monetary System, 2021, pp 7-38 from Springer

Abstract: Abstract The prevailing theories on the evolution of international money tend to neglect the reasons and conditions of the transition of commodity money, where the currencies’ face value corresponds to its intrinsic value, to forms of money in which this correspondence diminishes to practically disappear completely, as is the case with fiat money. This latter type of money, although characterized by an elasticity of supply with respect to the level of production that is considerably higher than commodity money, can only be accepted if suitable institutional mechanisms guarantee the stability of its value. At the national level this guarantee is offered by the state. In the international context, an international money exists when the conditions of a political exchange exist between a leading country, which bears the costs of producing trust in the fiat money (and the international monetary system based on it), in exchange for exploiting the seigniorage right, and follower countries, which attribute little weight to the relative gains made by the leading country’s exploitation of the seigniorage right and, at the same time, derive significant benefit from the existence of an international money, and the growth in trade and output associated with it.

Date: 2021
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:frochp:978-3-030-78491-1_2

Ordering information: This item can be ordered from
http://www.springer.com/9783030784911

DOI: 10.1007/978-3-030-78491-1_2

Access Statistics for this chapter

More chapters in Frontiers in Economic History from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().