Management Theory and Studies for Rural Business and Infrastructure Development, Volume 22

Monetary system: lessons and reforms

Jolita Radzevičiūtė

Abstract

The absence of an appropriate system of governance in international monetary and financial
relations is the main reason for the increasing prevalence of current-account imbalances in
the global economy. The article addresses the issue of the current international reserve system,
which has received greater attention in the context of the crisis. The role of the dollar as the main
reserve currency has been called into question, partly because it is believed to require a currentaccount
deficit in the United States. Reflections about an alternative reserve system are often linked
to the question of how to provide more adequate international liquidity to developing and
emerging-market economies. The question of the reserve currency involving Special Drawing
Rights (SDR), as the main form of international liquidity, has been presented. For solving the
problem of instability in international financial relations, is the need for appropriate reform of the
multilateral system of exchange-rate determination.
IMF is effectively in charge of designing a new architecture of the global financial system.
Dismemberment of big banks is reinforce competition in the banking sector, thus prevails
less the too-big-too-fail type problems. The article is prepared with focus on sistematic analysis
of scientific researches and public papers.

Keyword(s): current-account imbalances, international reserve system, reserve currency, Special Drawings Rights (SDR), International Monetary Fund (IMF)


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Management Theory and Studies for Rural Business and Infrastructure Development eISSN 2345-0355

This journal is published under the terms of the Creative Commons Attribution-Noncommercial 3.0 Unported License. Responsible editor: Dr Audrius Gargasas.