State-led or capital-driven? The fall of Bretton Woods and the German currency float reconsidered

Germann, Julian (2014) State-led or capital-driven? The fall of Bretton Woods and the German currency float reconsidered. New Political Economy, 19 (5). pp. 769-789. ISSN 1356-3467

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Abstract

The breakdown, some forty years ago, of the Bretton Woods system of fixed exchange rates centred on the US dollar and anchored in gold marks a pivotal moment in the governance of international capitalism. As the United States reneged on its commitment to redeem dollars in gold in August 1971, and the major central banks ceased to defend exchange-rate parities two years later, a historically novel global credit-money system of freely floating national currencies came into being. And as capitalist firms, banks, and speculators set out to hedge against the risks or benefit from the opportunities presented by widely fluctuating exchange rates, a powerful process of global financial innovation and integration was set in motion (McNally 2011: 92-3).

This article contributes to this task by focussing on one episode and actor in this process: the breakdown of the Bretton Woods system of fixed exchange rates that attempts to ‘bring the state back in’ (Helleiner 1995) have explained in terms of hegemonic power politics, the influence of global economic interests, or a neoliberal paradigm shift; and the prominent role of Germany in moving towards a floating regime that I argue defies these explanatory models.

Item Type: Article
Additional Information: Awarded the New Political Economy Graduate Student Prize for Best Paper in 2013.
Schools and Departments: School of Global Studies > International Relations
Subjects: J Political Science > JZ International relations
Depositing User: Jayne Paulin
Date Deposited: 26 Jul 2013 12:58
Last Modified: 06 Mar 2015 11:00
URI: http://sro.sussex.ac.uk/id/eprint/45787
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