Explaining Global Financial Imbalances: A Critique of the Saving Glut and Reserve Currency Hypotheses
This paper examines three different explanations of the global financial imbalances. It begins with the neoliberal globalization hypothesis that explains the imbalances as the product of the model of globalization implemented over the past thirty years. It then examines the saving glut and reserve currency hypotheses. The paper concludes by arguing that both the saving glut and reserve currency hypotheses are inconsistent with the empirical record and both provide a misleading guide for policy.
|Date of creation:||2011|
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- Thomas I. Palley, 2006. "The Fallacy of the Revised Bretton Woods Hypothesis: Why Today’s System is Unsustainable and Suggestions for a Replacement," Working Papers wp114, Political Economy Research Institute, University of Massachusetts at Amherst.
- Jan Kregel, 2010. "An Alternative Perspective on Global Imbalances and International Reserve Currencies," Economics Public Policy Brief Archive ppb_116, Levy Economics Institute.
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