Currency Statecraft and Monetary Cooperation: The Geopolitical Foundations of International Economic Order

This work highlights several instances of monetary cooperation during times of economic fragmentation and great power competition in the 1930s. The first chapter investigates the attitude of British policymakers to currency internationalisation. Due to the importance of geopolitical ambition as a motivating factor, the chapter finds a twofold British strategy regarding Sterling internationalisation. Within its sphere of economic influence, Britain pursued a policy of proactively safeguarding the international role of Sterling and developing mechanisms and policies supporting this aim. Outside, however, British statecraft was much more limited and conservative, illustrating geopolitical and economic constraints. The second chapter investigates the origins of the US Exchange Stabilisation Fund and its emergence as an International Lender of Last Resort. Using a historical institutionalist approach, the chapter finds that the Fund was confronted with a critical juncture in the form of the US silver purchasing act and its consequences, combined with geopolitical tensions. This increased policy options for policymakers, which fostered a transformation of the ESF into an International Lender of Last Resort, driven by domestic political motivations, as well as considerations of grand strategy. By investigating the case of the Nordic countries in the Sterling bloc, the third chapter explores the workings of currency blocs and the role of stabilisers played by the core country more in-depth, showing the crucial role of the Bank of England in the case of the Sterling bloc. The dissertation particularly highlights the importance of geopolitical motivations for economic cooperation, as well as the crucial role of agency.