Citation

Discussion Paper Details

Please find the details for DP5529 in an easy to copy and paste format below:

Full Details

Title: The Empirics of International Currencies: Historical Evidence

Author(s): Marc Flandreau and Clemens Jobst

Publication Date: March 2006

Keyword(s): dollar, international currencies, persistence, search theoretic approach to money, sterling and strategic externalities

Programme Area(s): International Macroeconomics

Abstract: Using a new database for the late 19th century, when the pound sterling circulated all over the world, this paper provides the first review of critical empirical issues in the economics of international currencies. First, we report evidence in favor of the search-theoretic approach to international currencies. Second, we give empirical support to strategic externalities. Third, we provide strong confirmation of the existence of persistence. Finally, we reject the view that the international monetary system is subject to pure path dependency in that it cannot remain locked into some past equilibrium. Our conclusion is that, for the late 19th century at least, money and trade were complements.

For full details and related downloads, please visit: https://cepr.org/active/publications/discussion_papers/dp.php?dpno=5529

Bibliographic Reference

Flandreau, M and Jobst, C. 2006. 'The Empirics of International Currencies: Historical Evidence'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=5529