Barry Eichengreen 243the United States imported gold, mainly from the Bank of England, which was
charged with pegging the sterling price of gold on the London market with a
gold reserve of only £30 million. As the American economy grew, both its average
demand for gold from London and that demand’s seasonal fluctuation increased
relative to the Bank of England’s primary reserve and its capacity to attract
supplementary funds from other centers. To rephrase de Cecco’s argument in
terms of hegemonic stability theory, the growth of the United States relative to
that of Britain undermined Britain’s capacity to stabilize international financial
markets: specifically, its ability to serve simultaneously as the world’s only free
gold market, providing however much gold was required by other countries,
and to maintain the stability of sterling, the reference point for the global system
of fixed exchange rates. In a sense, de Cecco sees indications of the interwar
stalemate—a Britain incapable of stabilizing the international system and a United
States unwilling to do so—emerging in the first decade of the twentieth century.
From this perspective, the process of hegemonic decline that culminated in the
international monetary difficulties of the interwar years was at most accelerated
by World War I. Even before the war, the processes that led to the downfall of
established monetary arrangements were already under way.
CONCLUSION
Much of the international relations literature concerned with prospects for
international monetary reform can be read as a search for an alternative to
hegemony as a basis for international monetary stability. Great play is given
to the contrast between earlier periods of hegemonic dominance, notably 1890–
1914 and 1945–1971, and the nature of the task presently confronting aspiring
architects of international monetary institutions in an increasingly multipolar
world. In this paper I suggest that hegemonic stability theories are helpful for
understanding the relatively smooth operation of the classical gold standard
and the early Bretton Woods system, as well as some of the difficulties of the
interwar years. At the same time, much of the evidence is difficult to reconcile
with the hegemonic stability view. Even when individual countries occupied
positions of exceptional prominence in the world economy and that prominence
was reflected in the form and functioning of the international monetary system,
that system was still fundamentally predicated on international collaboration.
Keohane’s notion of “hegemonic cooperation”—that cooperation is required
for systemic stability even in periods of hegemonic dominance, although the
presence of a hegemon may encourage cooperative behavior—seems directly
applicable to international monetary relations. The importance of collaboration
is equally apparent in the design of the international monetary system, its
operation under normal circumstances, and the management of crises. Despite
the usefulness of hegemonic stability theory when applied to short periods
and well-defined aspects of international monetary relations, the international
monetary system has always been “after hegemony” in the sense that more
than a dominant economic power was required to ensure the provision and