Macroeconomic policy autonomy, internacional currency hierarchy and monetary sovereignty

• Grant number: 15/16993-4
• Support type: Scholarships abroad - Research
• Effective date (Start): September 01, 2016
• Effective date (End): June 30, 2017
• Field of knowledge: Applied Social Sciences - Economics - International Economy
• Principal researcher: Daniela Magalhães Prates
• Grantee: Daniela Magalhães Prates
• Host: P Arestis
• Home Institution: Instituto de Economia (IE). Universidade Estadual de Campinas (UNICAMP). Campinas , SP, Brazil
• Research place: University of Cambridge, England

Abstract

The global financial crisis of 2008/2009 revealed that the relationship between macroeconomic policy autonomy, international currency hierarchy and monetary sovereignty in the contemporary international monetary and financial system still needs to be deepened. On the one hand, the countercyclical macroeconomic policy adopted by many emerging economies in face of the contagion effect of the crisis suggest that climb the currency hierarchy is not pre-condition and/or the only way to increase the macroeconomic policy autonomy of countries whose currencies are positioned at its floor. On the other hand, the crisis has also shown that alternative of monetary regionalization as a way to that climb and to overcome the dilemmas associated with the non-issue of an international currency (adopted by the peripheral countries of the euro area) could prove counterproductive inasmuch it results in the loss of monetary sovereignty. This research aims to step forward in the understanding of this relationship in the current international monetary and financial system. For this purpose, it will develop an analytical framework that integrates consistently two strands of the Keynesian economic literature: the first on the international currency hierarchy and the second on the sovereign currency