POLI 445 Lecture 3: Poli 445 Class Notes
27 Mar 2018
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330 leacock, office hours: tues. 2-3, wed. 10 11. Stable, open international financial systems provide flows of international investments, means for making payments, etc. Lenders and borrowers took on risks they shouldn"t have. (i. e. , 1970s 1980s) Stable, open financial systems require: recognize, useful medium of exchange, intermediating institutions, lender of last resort (llr) There is often a political authority in domestic systems. There are other institutions, i. e. , private banks. Lender of last resorts has been developed by central banks and governmental institutions. Political power has been used in the domestic setting to ensure that monetary systems will function well. Gold standard was used as a set of rules amongst states. Finding means of payments internationally (preferred means of payments) Policy responses to these challenges vary over time and across cases . We will emphasize the political explanation for variation. Balance of payments: the total you either owe (a deficit) or are due (a surplus) via interactions with other states.
