The Domestic Politics of the International Dollar Standard
A Statistical Analysis of Support for the Reserve Currency, 2000–2008
Bibliographic Data
| ID | 6243189 |
|---|---|
| Authors | Victor Shih, Victor C Shih (0000-0003-2480-185X, University of California San Diego), David A Steinberg (0000-0002-6461-789X) |
| Year | 2012 |
| Volume | 45 |
| Issue | 4 |
| Pages | 855-880 |
| Publication date | 2012-12-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Canadian Journal of Political Science (JOURNAL) |
| Journal identifiers | ISSN: 0008-4239 • E-ISSN: 1744-9324 |
| Publisher | Cambridge University Press (CUP) (PUBLISHER) |
| DOI | 10.1017/s0008423912001059 |
| OpenAlex | W2101513847 |
| Language | EN |
| Citations received | 3 |
| References cited | 41 |
Why did most central banks continue to purchase dollar reserves during the 2000s even though they suffered mounting financial losses as a result of this policy? This paper argues that domestic political considerations determine whether policy makers accumulate or dump the reserve currency. We hypothesize that central bank independence decreases support for the dollar because independent central banks reduce the political clout of exporters and increase the salience of financial performance. This argument is tested using data on countries' holdings of US Treasury securities between 2000 and 2008. The statistical results indicate that countries with independent central banks were more likely to sell and less likely to purchase US treasuries. Our findings suggest that a complete understanding of the international dollar standard requires greater attention to domestic politics and how political institutions influence the balance of power between competing interest groups.Résumé.Pourquoi est-ce que la plupart des banques centrales ont continué à acheter des réserves de dollars au cours des années 2000, même quand ils souffraient des pertes financières en raison de cette politique? Cet article soutient que des considérations de politiques nationale déterminent si les responsables des politiques décident d'accumuler ou de vider leurs monnaie de réserve. Nous émettons l'hypothèse que l'indépendance de la banque centrale décourage le soutien pour le dollar, car les banques centrales indépendantes réduise la puissance politique des exportateurs et augmente l'importance de la performance financière. Cet argument est testé en utilisant des données sur la quantité de titres du Trésor américain possédée par pays entre 2000 et 2008. Les résultats statistiques démontrent que les pays avec des banques centrales indépendantes étaient plus susceptibles de vendre et moins susceptibles d'acheter des obligations du Trésor américain. Nos résultats suggèrent qu'une compréhension complète de l'étalon dollar international exige une plus grande attention à la politique nationale, et comment les institutions politiques influencent l'équilibre du pouvoir entre les groupes d'intérêts concurrents
Central bank · Currency · Devaluation · Economics · Economy · Financial system · Foreign-exchange reserves · Humanities · International economics · Liberian dollar · Monetary economics · Monetary policy · Political science · Politics · Reserve currency · Welfare economics · Banking stability, regulation, efficiency · Finance · Fiscal Policies and Political Economy · Global Financial Crisis and Policies · Law
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| Unique citing works | 3 |
|---|---|
| Citations per year | 0,23 |
| Citation span | 2013 - 2025 (13) |
| Citation velocity | recent |
| Highly cited | No |
| Citation types | Neutral: 3 |