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Reform of the International Monetary System: Why and How? (Karl Brunner Distinguished Lecture Series)

Penned By John B. Taylor
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Reform of the International Monetary System: Why and How? (Karl Brunner Distinguished Lecture Series)

Penned By John B. Taylor
4.85 41,147 Ratings
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Editor's Note:
An argument that a rules-based reform of the international monetary system, achieved by applying basic economic theory, would improve economic performance.In this book, the economist John Taylor argues that the apparent correlation of monetary policy decisions among different countries—largely the result of countries' concerns about the exchange rate—causes monetary policy to deviate from effective policies that stabilize inflation and the economy. He argues that a rules-based reform of the international monetary system, achieved by applying basic economic theory, would improve economic performance.Taylor shows that monetary polices in recent years have been deployed either defensively, as central banks counteract forces from abroad that affect the exchange rate, or offensively, as central banks attempt to move the exchange rate to gain a competitive advantage. Focusing on the years from 2005 to 2017, he develops an empirical framework to examine two monetary policy instruments: the policy interest rate (the more conventional of the two) and the size of the balance sheet. He finds that an international contagion in central bank decisions about the policy interest rate has accentuated the deviation from standard interest rate rules that have worked in the past. He finds a similar contagion in decisions about the size of the balance sheet. By considering a counterfactual policy in the estimated model, Taylor is able to estimate by how much the policy of recent years has increased exchange rate volatility. After several rounds of monetary actions and reactions aimed at exchange rates, Taylor finds, the international monetary system is left with roughly the same interest rate configuration, but much larger balance sheets to unwind.

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John B. Taylor
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John B. Taylor

John B. Taylor is the author of several novels. Originally from the East Coast, they now live in the Midwest with family. In addition to writing, John B. Taylor enjoys gardening, cooking, and reading way past bedtime. Their work often explores the complexities of everyday life and human relationships.

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Lisa Rivera
Lisa Rivera March 12, 2025
"A profoundly satisfying read. The pacing was impeccable and the characters felt incredibly authentic. I was completely immersed. Worth every moment spent reading."
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"Honestly one of the most premium reading experiences lately. I adored how the story unfolded. It kept me captivated without sacrificing elegance. An absolute must-read for connoisseurs of the genre."
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David Williams
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"Honestly one of the most premium reading experiences lately. The author orchestrated a breathtaking finale. Truly a work of art. Worth every moment spent reading."
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"Exceeded all my expectations. The author orchestrated a breathtaking finale. Truly a work of art. I will undoubtedly revisit this masterpiece."
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"A profoundly satisfying read. The author orchestrated a breathtaking finale. Truly a work of art. An absolute must-read for connoisseurs of the genre."
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Nicholas Diaz March 30, 2025
"Honestly one of the most premium reading experiences lately. The author orchestrated a breathtaking finale. Truly a work of art. I will undoubtedly revisit this masterpiece."
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