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Finance and Credit
 

A role of organizational and institutional conditions in forming the contemporary global currencies

Vol. 21, Iss. 40, OCTOBER 2015

PDF  Article PDF Version

Received: 23 June 2015

Accepted: 6 July 2015

Available online: 3 November 2015

Subject Heading: WORLD MONETARY SYSTEM

JEL Classification: 

Pages: 44-50

Kudryashova I.V. Volgograd State University, Volgograd, Russian Federation
inna.kudrjaschowa@yandex.ru

Importance As the article shows, the percentage of US dollar, euro, British pound, and yen has declined in the currency structure of reserve assets worldwide, on the one hand, and certain countries (Russian Federation, People's Republic of China) intend to expand global functions of their national currencies, on the other hand. It necessitates a research into the existing experience of global issuers in creating conditions that help those currencies reach that high international status.
     Objectives The research examines organizational and institutional conditions for internationalizing monetary functions of certain currencies and demonstrates their significance for the British pound, US dollar, yen, Deutschemark and French franc, and, subsequently, euro to become international currencies.
     Methods I applied a historical method, tables, synthesis, deduction, and the method of comparative analysis.
     Results I emphasize the significance of zero currency restrictions on the current and capital transactions of the balance of payment, and open national financial market as conditions for forming contemporary international currencies as part of the evolution of the global monetary system.
     Conclusions and Relevance The British pound, US dollar, yen, Deutschemark, French franc and, subsequently, euro that replaced the two latter currencies became a standard of value, means of payment and reserves after the organizational and institutional environment was created, thereby letting non-residents make various deals using these currencies.

Keywords: global currency, internationalization, monetary functions, financial market, convertibility, currency restrictions

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