The Present International Monetary System: Problems, Complications, and Reforms

In the last decade serious crises have affected financial markets. Some proposals to avoid international financial crises have been made, but more useful could be measures to strengthen the functioning of the present international monetary system. Another way could be a much greater involvement of the private sector. The misalignment among leading currencies of the world can be a source of crisis difficult to solve. The creation of the European Central Bank (ECB) and of the euro leaves unresolved the serious problem of how a European Monetary Union member will respond to an asymmetric shock. Copyright Kluwer Academic Publishers 2000early-warning system, emerging-market economies, euro, European Central Bank, European monetary system, European Monetary Union, exchange-rate arrangements, exchange-rate mechanism, global financial integration, International Monetary Fund, international monetary system, international policy coordination, optimum currency area, target zones, transition economies,