Pub. date: 2011 | Online Pub. Date: October 04, 2011 | DOI: 10.4135/9781412994163 | Print ISBN: 9781412959636 | Online ISBN: 9781412994163| Publisher:SAGE Publications, Inc.About this encyclopedia
International “monetary relations” refers to the efforts of sovereign states to influence the conditions of cross-border flows of money and other financial assets, especially money flows that are not the direct counterpart of real exchanges of goods and services. These conditions include but are not limited to exchange rate regimes and levels, capital and investment controls, foreign debt contracts, the use of reserve currencies, regulation of multinational banks and nonbank financial institutions, and balance-of-payments crisis management. After situating the topic in its theoretical and historical contexts, this entry discusses the relationship of monetary legitimacy to state power, the ambiguous nature of global monetary governance, and the contemporary monetary issues of greatest concern. A final section highlights the range of theoretical and methodological perspectives in use. Neoclassical economists typically make a number of assumptions when examining the international monetary system, among the most significant being that financial firms and investors act ...