Advanced Search
MyIDEAS: Login to save this article or follow this journal

War and exchange rate valuation


Author Info

  • Christopher E.S. Warburton

    (Department of Economics, John Jay College of Criminal Justice, New York, U.S.A)


This article investigates the extent to which the dominance of the United States (U.S.) dollar as an international currency has been contingent on American diplomacy rather than the prosecution of expensive wars. Four wars are examined, the Korean War (1950-1953), the Vietnam War (1964-1975), the Persian Gulf War (1990-1991), and the Iraq War (2003-present). The historical performance of the dollar is examined in times of war and peace, and the Box-Jenkins forecasting algorithm is employed to make a short-term projection of the dollar coinciding with the Iraq war. The price of gold is used as a measure of the value of the U.S. dollar and investor confidence in the dollar during times of war and peace. The empirical evidence shows a short-term depreciation of the U.S. dollar coinciding with the Iraq War, which is not atypical of the value of the U.S. dollar in a time of war. Problems with the value of the U.S. dollar in times of war lead to the exploration of alternative forms of money, which if very successful, can erode the continued dominance of the U.S. dollar as an international currency.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL:
Download Restriction: Access to full text for Volume 2 onwards is restricted to subscribers

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by Economists for Peace and Security (UK) in its journal Economics of Peace and Security Journal.

Volume (Year): 4 (2009)
Issue (Month): 1 (January)
Pages: 62-69

as in new window
Handle: RePEc:uwe:journl:v:4:y:2009:i:1:p:62-69

Contact details of provider:
Postal: Frenchay Campus, Coldharbour Lane, Bristol BS16 1QY
Phone: 0117 328 3610
Web page:
More information through EDIRC

Related research

Keywords: currency valuation; forecasting; optimum currency areas; war.;

Find related papers by JEL classification:


No references listed on IDEAS
You can help add them by filling out this form.



This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.


Access and download statistics


When requesting a correction, please mention this item's handle: RePEc:uwe:journl:v:4:y:2009:i:1:p:62-69. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (J Paul Dunne).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.