Summary of Exorbitant Privilege
The Rise and Fall of the Dollar
Threats to the dollar’s role as the reserve currency are growing. What does that mean for the US and the world?
Professor Barry Eichengreen’s exploration of the dollar’s reserve currency role could be merely an interesting history of currencies and repositories of value – from wampum and whelk shells to credit default swaps – all mapped out from Bretton Woods to the Maastricht Treaty to China’s looming role and beyond. But Eichengreen accounts for more than history as he expertly guides readers through the maze of the international monetary system. getAbstract finds that unresolved issues in world markets give this exposition considerable contemporary bite. Eichengreen argues solidly that the threats to the dollar’s international reserve status are real enough, but says all signs are that the dollar will endure as the first among rivals, even if other regional kingpins arise. He seems to believe that, despite its various crises and challenges, the dollar will remain dominant – but, in the end, he ducks a definitive judgment and concludes that its fate is in American hands and not in those of the Chinese or other international competitors.
In this summary, you will learn
- How the international financial system deals with crises
- How current rivals threaten the dollar’s global reserve currency status
- How to protect the US’s “exorbitant privilege.”
About the Author
Barry Eichengreen is a professor of economics and political science at the University of California, Berkeley, and the author of Financial Crises and What To Do About Them and The European Economy Since 1945.
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