11. The Euro and the World Economy
- Author:
- Fred Bergsten
- Publication Date:
- 04-2005
- Content Type:
- Working Paper
- Institution:
- Peterson Institute for International Economics
- Abstract:
- The dollar has been the dominant currency of the world economy for almost a century for a single overwhelming reason: It had no competition. No other economy came close to the size of the United States. Hence no currency could acquire the network externalities, economies of scale and scope, and public goods benefits necessary to rival the dollar at the global level. A similar situation for the United Kingdom explains sterling's dominance in the 19th century.
- Topic:
- Economics and International Trade and Finance
- Political Geography:
- United States, United Kingdom, and Europe