Keynes and Currency Reform: Some Lessons for Eastern Europe
7 Pages Posted: 26 Jan 2013
Date Written: 1990
For an economy to function well, it needs a currency that people can use to purchase a wide variety of goods and services, that is readily convertible into foreign exchange, and that is a reliable store of value. The currencies of the newly democratized nations of Eastern Europe do not possess these qualities. Indeed, as the physical barriers between Eastern and Western Europe have been destroyed, the invisible barriers – mainly in the form of inconvertible currencies – have become more prominent. Hence, unless successful currency reforms can be implemented, the nations of Eastern Europe will not be able to sustain economic progress.
Keywords: Steve Hanke, Keynes, Currency Reform, Eastern Europe Currency Boards
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