Discussion — Reading 7: Robert Mundell

This session covers Reading 7: A Reconsideration of the Twentieth Century by Robert Mundell

The reading forms the basis for Lecture 14 (next week). In it, Mundell tells a story of the evolution (devolution?) of the international monetary system over the course of the 20th century. He wants to address exchange rate stability through domestic price level stability, ultimately paving the way for a new international currency: the euro.

Perry Mehrling says:

"This piece is meant mainly to set the scene for our discussion of foreign exchange, in the same way that the Allyn Young piece set the scene for Part One. Note the importance that Mundell places on the price of gold—is he a metallist? He also uses the language of discipline and elasticity—is his view compatible with the money view? Note p. 333 his emphasis on US deficit as the source of world reserves, and compare with the Kindleberger reading below."

Study Questions

Mundell Reading Discussion Thread