Economics term paper Example | Topics and Well Written Essays - 2500 words

Economics - Term Paper lesson44 Allied nations from 1 July to 22 July 1944 to sign agreements for the establishment of International Bank for Reconstruction (IBRD, the public Bank), the International Trade Organization (ITO), and the International Monetary Fund (IMF). A system of exchange grade management was deployed, which was working till 1970. Currency conversion was mandatory by the portion countries of the agreement, which became functional lonesome(prenominal) in 1959, culminating in the setting of IMF and IBRD. As per the agreement, the member nations needed to consult one anther to r apiece a unilateral decision on global monetary cultivations, impacting the economies of all nations. The purpose behind the creation of IBRD was to pay back quick action for post-war reconstruction, to reach political stability, and promote peace through making of programs for reconstruction and development .Thus, the major industrial nations of the world came closer by framing rules for introducing a system of monetary functions of businesses among the confederative powers of the World War II. By 1945, the IBRD an associate of World Bank Group currently and IMF started functioning after(prenominal) the ratification of the agreement by a good number of member countries. As per the agreement, in each member countrys monetary policy it was mandatory to maintain the exchange rate of its coin around a fixed value with the flexibility of 1 percent up or garbage down against gold. It was essential to clear the imbalances in payments by the IMF. The system couldnt work beyond 1971 due to increase financial glitches and one-sided termination of conversion of dollar into gold by the fall in States. This action of the United States created furors in the international economy, and a new situation surfaced making the dollar reserve currency for the member nations that signed the agreement .The worldwide depression of