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It Is Time to Abandon Dollar Hegemony
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It Is Time to Abandon Dollar Hegemony

Issuing the World’s Reserve Currency Comes at Too High a Price

Simon Tilford and Hans Kundnani
Foreign Affairs, 2020
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Editorial Rating

8

Qualities

  • Analytical
  • Eye Opening
  • For Experts

Recommendation

In response to COVID-19, the American government has authorized trillions in monetary support for its economy, a move made possible in part by the US dollar’s status as the world’s reserve currency. Economists Simon Tilford and Hans Kundnani explore the benefits and disadvantages to the United States of that special position, and they examine whether it might be in the nation’s best interest to walk away from the role. Business executives, policy experts and economists will appreciate this informed and insightful report on the future of the US dollar.

Take-Aways

  • Because the US dollar serves as the world’s reserve currency, the United States enjoys a distinct advantage, but that benefit comes with socioeconomic drawbacks.
  • America could voluntarily step back from its role as issuer of the global reserve currency.
  • The United States may not find it economically viable to retain the dollar’s reserve currency status in the long run.

About the Authors

Simon Tilford is the chief economist at the Tony Blair Institute for Global Change. Hans Kundnani is a senior research fellow at the Europe Programme at Chatham House.  

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