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  • Print publication year: 2006
  • Online publication date: December 2009



The tripartite agreement of 25 september 1936 between the United States, Great Britain, and France was the last prewar attempt to remold international monetary institutions. The aim was to stop competitive devaluations, remove trade barriers, and return to multilateral trade. The agreement did not fully attain its purposes – at best, it inhibited the destabilizing conduct of the years preceding – but it did roughly outline the design for a new set of rules (Eichengreen 1992a, 379–82). In particular, it brought out the need to negotiate a new institutional framework based on exchange rate stability to enhance international trade. With the war, economists' interest in the topic waned and the debate petered out. Witness the papers presented to the American Economic Association in December 1940, which mostly treated past or current policy issues rather than novel monetary schemes. Academic discussion, in fact, developed only after the publication of the official reform projects in 1943; it was policymakers who were on the front line.

From the outbreak of hostilities, the belligerents posed the question of reconstructing the monetary system. In Germany, Walther Funk (1940), minister for the economy and president of the Reichsbank, suggested replacing the gold standard, the symbol of British hegemony, and London, the center of international finance, with a New Order headquartered in Berlin. As described by the Reichsbank's vice-president (Puhl 1940), the plan was to introduce a clearing mechanism among the countries of continental Europe.

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