Globalization and Imbalances in Historical Perspective

13 Pages Posted: 28 Oct 2007

See all articles by Michael D. Bordo

Michael D. Bordo

Rutgers University, New Brunswick - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: January 2006

Abstract

Global imbalances associated with the U.S. current account deficit have given rise to speculation about the nature of the impending adjustment: Will it be smooth and gradual, or will it be sudden and costly? This paper summarizes the two views and then considers three historical periods with similar pressures--an earlier era of globalization from 1870 to 1914, the interwar gold standard, and Bretton Woods. A comparison of the periods and their outcomes suggests current global imbalances might resolve themselves quietly.

Suggested Citation

Bordo, Michael D., Globalization and Imbalances in Historical Perspective (January 2006). FRB of Cleveland Policy Discussion Paper No. 13. Available at SSRN: https://ssrn.com/abstract=1024835 or http://dx.doi.org/10.2139/ssrn.1024835

Michael D. Bordo (Contact Author)

Rutgers University, New Brunswick - Department of Economics ( email )

New Brunswick, NJ
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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