The Research On The International Monetary Coordination Under The Background Of Economy Globalization

Abstract: The history of economy development is surging today as never before. Surging tide of economy globalization collapses the borders and sovereignty completely which the traditional nations have spent many years to defend. However, the governance structure of economy globalization has lagged far behind the development of economy globalization. Monetary and financial globalization is the most spectacular scenery. The financial globalization in depth brings forward the practical needs of the international monetary coordination. Indeed, the monetary and financial theory has been developing along with the development of monetary and financial practice, but is still unable to catch up with the rapid pace. How to improve international monetary coordination under economy globalization so that the current international monetary coordination can be more effective, whether the world would effectively control its economy, the sustainability of global economic stability and harmonious development are major problems.In order to provide reference for the current coordination, the international monetary coordination should seek theoretical support under economy globalization and aggregating analysis of the history on the international monetary coordination. Analyzing the framework of the international monetary coordination and the coordination of the existing inefficiency and failure and putting forward views about the development of international monetary coordination are very important. Meanwhile, this paper analyzes China how to participate in the international monetary coordination.The paper is composed of three parts: introduction, text and conclusion.The introduction mainly introduces the background, inside and outside research situation, configuration of the paper , innovation and the research method of the paper and the core concept.Chapter I to chapter VII is the paper text.The chapter I analyzes the specificity and the complexity of policy effect of economic globalization to global economic development, highlights the importance of the international monetary coordination.The chapter II seeks to find theory support of international monetary coordination under economy globalization. First, why to implement monetary coordination, the theory focus on the centralization and depart policy coordination theory and Mundell-Flemming model of open economy. The author tries to develop the centralized and depart policy coordination under the background of economic globalization. Mundell-Flemming model explains why the International monetary need to coordinate from the point of spillover and feedback effects of the open economy. Economy globalization is the broader economy than "open economy", so the International monetary coordination should be a more prominent position.The international monetary coordination needs to release or transfer restrictions of the national sovereignty, the development of state sovereignty theory under economic globalization has solved this problem. This theory points that monetary policy is subordinate to the rights of national sovereignty, it could be released or restricted in some cases. Thus, the sovereignty obstacle of international monetary coordination has been soften or eliminated.From the perspective of game theory, coordination can strengthen the effect of monetary policy greatly. Hamada model deems that international monetary coordination could make one national welfare reaching to Pareto optimal. Optimum currency areas theory indicates the method and influencing elements of the regional monetary coordination in international monetary coordination.Under financial globalization, the international monopoly capital and malicious speculation, the shortage of public goods in the international monetary field, asymmetric information on the international financial markets led to the international financial markets failure. The independence of monetary policy and the effects of monetary policy is on the decline. Most of all, any. exchange rate arrangements can't resist the invasion of the monetary and financial crisis. Based on the above characteristics of the economy, an extensive and in-depth economy monetary coordination is necessary and essential.The chapter III analyzes the history of the international monetary coordination performance, to provide lessons to today's international monetary coordination.Under golden standard, the coordination of international monetary achieves without international pressure. The gold bullion standard and the golden exchange standard partial destructed the gold coin functions, the monetary imbalance led to the complete collapse of the gold standard.The monetary coordination which relevant to people intervene begins on currency groups in early 20th century. It can be departed into two parts. First, the currency coordination inside the group shows obvious colonialism, in which the colonist shared of benefits and refused to shoulder costs, which resulted in the coordination failure. Currency coordination between the groups indicated that the disordered development of finance can't block the progress of monetary coordination, at the same time , it also opens out an embarrass: g fact, that is, the active diplomacy of finance often goes with financial contradiction between countries and the Currency coordination always occurs after the currency crisis.At the background of Economic Globalization, the disadvantage of finance crisis will be very seriously, taking precautions is the best choice in international monetary coordination currently.The Bretton Woods System which set up at 1940s made dollar as its centre and maintained this system depending on monetary coordination. At its beginning, the international monetary coordination went well, but with the economic strength of powerful countries such as America , Germany and so on, the dissymmetry in the international monetary coordination became more and more evident. The failure on international monetary coordination resulted to The Bretton Woods System breaking down, Which told us that we should pay more attention to research the symmetry of the responsibility and the benefit in international monetary coordination.In the fourth chapter, the paper discusses the frame and regime of international monetary coordination and its developing trends.Jamaica system formed an new international monetary coordination framework, where International monetary Fund's multilateral international monetary coordination, G7 international monetary coordination, group of 20 countries' international monetary coordination mechanisms and regional monetary coordination mechanism stayed at the same time, which sustained each other and collided with each other.The present international monetary coordination frame made a great function in several aspects such as balance of payments coordination, supervising and guarding against the risk in capital market, financial risk helping, coordinating the economic and currency policies between the powerful countries and the collaboration of regional currency, and the coordination must be strengthen in these fields.The fifth chapter analyzes the effect of the international monetary coordination and its reasons. As a whole, the complicated international monetary coordination can't cover its inefficient .This was showed in the international monetary coordination of IMF, the international monetary coordination between the powerful countries and also the regional monetary coordination. The paper then analyzes reasons from the views of the economics, the institutional economics and the political science fields. The national reasonable anticipation, the opposite policy intervened , the difficulty in managing international hot money under financial liberalization and the bad economic policy of IMF are the important reasons of inefficiency of international monetary coordination; Incompact and non-institutional harmonizing is the primary institutional factor. The conflict of national benefits, the lack of international coordination authority, the monetary hegemony are the political factors to inefficiency and failure of international monetary coordination.The sixth chapter discusses the perfecting and development of international monetary coordination. To the need of economic globalization and question in international monetary coordination , the author emphasizes the strengthen of multilateral international monetary coordination of IMF, including the reorientation of subject to coordinate, the foundation of mechanism of stabilizing and coordinating exchange rate in powerful countries such as Dollar, the Euro and Yen which is participated by IMF , the way to reforming national debt mechanism, the strengthening of salvation to short—term liquidity, adjusting the institutional setting of monetary coordination in powerful countries. For regional currency harmonizing, the author suggests implement multilayer monetary governance in Europe union, advancing the bilateral dollarization in America and subordinated area monetary coordination.The seventh chapter analyzes how the RMB participate the international monetary coordination. The participation of RMB is crucial to international monetary coordination. Currently, RMB can't lead international or Asian regional monetary coordination, but RMB has been put into the stage of international monetary coordination. In the process of RMB becoming international currency, we should reasonably coordinate the relationship with powerful countries' currency such as Dollar, the Euro and Yen, publicize RMB policy with the help of multilateral international agreement and forum, expedite the adjustment of civil. economic structure and developing manner, strengthen the sustaining developing. At the meantime, we should also make the most use of consanguineous economic connection among the mainland and HK, Marco, Taiwan in order to conform the currency in Chinese economic extension.The last is paper's main conclusion and prospect to this study.