After leading the world economy for a century, the United States faces the first real challenge to its supremacy in the rise of China. Is economic (or broader) conflict, well beyond the trade and technology war that has already erupted, inevitable between the world's two superpowers? Will their clash produce a new economic leadership vacuum akin to the 1930s, when Great Britain was unable to play its traditional leadership role and a rising United States was unwilling to step in to save the global order? In this sweeping and authoritative analysis of the competition for global economic leadership between China and the United States, C. Fred Bergsten warns of the disastrous consequences of hostile confrontation between these two superpowers. He paints a frightening picture of a world economy adopting Chinese characteristics, in which the United States, after Trump abdicated much of its role, engages in a self-defeating attempt to "decouple" from its rival. Drawing on more than 50 years of active participation as a policymaker and close observation as a scholar, Bergsten calls on China to exercise constructive global leadership in its own self-interest and on the United States to reject a policy of containment, avoid a new Cold War, and instead pursue "conditional competitive cooperation" to work with its allies, and especially China, to lead, rather than destroy, the world economy.

An examination of the role of the dollar in the global financial system which presents a long-term historical perspective on the international monetary system in this century. The main focus is on the evaluation of the global financial system in the post-war period.

China has emerged as an economic powerhouse (projected to have the largest economy in the world in a little over a decade) and is taking an ever-increasing role on the world stage. China's Rise: Challenges and Opportunities will help the United States and the rest of the world better comprehend the facts and dynamics underpinning China's rise-an understanding that becomes more and more important with each passing day. Additionally, the authors suggest actions both China and the United States can take that will not only maximize the opportunities for China's constructive integration into the international community but also help form a domestic consensus that will provide a stable foundation for such policies. Filled with facts for policymakers, this much anticipated book's narrative-driven, accessible style will appeal to the general reader. This book is unique in that it analyzes the authoritative data on China's economy, foreign and domestic policy, and national security. The expert judgments in this book paint a picture of a China confronting domestic challenges that are in many ways side effects of its economic successes, while simultaneously trying to take advantage of the foreign policy benefits of those same successes.China's Rise: Challenges and Opportunities from The China Balance Sheet Project, a joint, multiyear project of the Center for Strategic and International Studies and the Peterson Institute, discusses China's military modernization, China's increasing soft power influence in Asia and around the world, China's policy toward Taiwan, domestic political development, Beijing's political relations with China's provincial and municipal authorities, corruption and social unrest, rebalancing China's economic growth, the exchange rate controversy, energy and the environment, industrial policy, trade disputes, and investment issues. This book is part of the CSIS-IIE China Balance Sheet project. For more information about this project, please visit www.chinabalancesheet.org.

Building on the highly successful 2003 volume, Dollar Overvaluation and the World Economy, this book assesses the progress that has been made to date in correcting the sizable misalignments of key national currencies that developed in the late 1990s and early 2000s. The new volume examines how much dollar decline is needed for the United States to achieve a sustainable current account position and what the impact of a major dollar realignment would be on other economies around the world. It stresses the need for China and other Asian countries to participate actively in this adjustment process and also features new ideas on the effectiveness of intervention in moving exchange rates in a desired direction. Dollar Adjustment brings together perspectives from government, industry, and academia in several of the key countries..

Over the course of five decades, John Williamson has published an extraordinary number of books, articles, and other pieces on topics ranging from international monetary economics to development policy and bridging scholarly literature and policy debates. This book provides an overview and insight into Williamson's work. It includes contributions from the editors, Stanley Fischer, Edwin M. Truman, Paul De Grauwe, Yuemei Ji, Marcus Miller, Avinash Persaud, Stephany Griffith-Jones, Dagmar Hertova, Olivier Jeanne, Shankar Acharya, Jose Antonio Ocampo, and an essay by John Williamson on designing economic policy.

What are the key foreign economic policy issues facing the United States in the second half of this decade? How can the administration and Congress meet the economic challenges that lie ahead? This new book analyzes the dramatic importance of the world economy to both the domestic prosperity and overall foreign policy of the United States, describes the new global environment (e.g., the rise of China as a global economic superpower and the completion of European unification) in which US policy must operate, and proposes major US initiatives on a wide range of international economic issues, including correction of the huge current account deficit, new trade negotiations, and energy. Individual chapters by senior staff of the Institute on each of the key topics are included.

Conflicts over currency valuations are a recurrent feature of the modern global economy. To strengthen their international competitiveness, many countries resort to buying foreign currencies to make their exports cheaper and their imports more expensive. In the first decade of the 21st century, for example, China's currency manipulation practices were so flagrant that they produced a backlash in the United States and other trading partners, prompting threats of retaliation. How damaging is the practice of currency manipulation-and how extensive is the problem? This book by C. Fred Bergsten and Joseph E. Gagnon-two leading experts on trade, investment, and the effects of currency manipulation-traces the history, causes, and effects of currency manipulation and analyzes a range of policy responses that the United States could adopt. The book is an indispensable guide to a complex and serious problem and what might be done to solve it.

This Special Report looks at the long-run prospects for the international economic position of the United States, with particular focus on the likely evolution of the current account deficit and prospective foreign financing for it. Its goal is to provide a fundamental framework for the development of US fiscal and other economic policies, especially including responses to the global financial and economic crisis of 2008-09. The central message is that the long-run outlook is extremely worrisome and potentially very costly-in foreign policy/national security as well as economic terms. As the country (and the world) emerges from the global crisis, and even in fashioning policy responses to the crisis itself, it will be essential to keep the long-run considerations firmly in mind. This will require early and decisive policy actions, perhaps even in tandem with the near-term stimulus and housing initiatives, to address the ever-escalating costs of the major entitlement programs, Social Security and especially Medicare/Medicaid, and thus the country's overall fiscal position.

In September 1985, emissaries of the world's five leading industrial nations-the United States, Britain, France, Germany, and Japan-secretly gathered at the Plaza Hotel in New York City and unveiled an unprecedented effort to correct the largest set of current account and exchange rate imbalances that had ever threatened the world economy. The Plaza Accord is credited with sharply realigning exchange rates, significantly reducing current account imbalances, and countering protectionist pressures in the United States. But did the Accord provide a foundation for ongoing international financial stability and policy coordination? Or was it simply a unique one-time coincidence of national interests?The Plaza experience continues to inform today's debates about the limits and possibilities of international monetary cooperation. In late 2015, leading policymakers and economists-including those who were involved in the Accord's design, negotiation, and implementation-held a Plaza Retrospective conference at the Baker Institute for Public Policy to evaluate the Accord's legacy and how its collaborative spirit can be applied today. This volume presents their views and analyses to provide guidance for a time when the world again faces the prospect of currency disequilibria, growing imbalances, trade policy reactions, and thus uncertainty for both the global economy and world politics.Data disclosure: The data underlying the analysis in this volume are available. The data used in chapter 14 are taken directly from William Cline's Policy Briefs 15-8 and 15-20, with the exception that they have been manipulated with a key assumption stated in the chapter.

The dollar rose by about 35 percent in real terms from 1995 through the end of 2001, supporting the booming US economy of the late 1990s but pushing the current account deficit to a record high of almost 5 percent of GDP. This special report provides alternative views of how large a dollar depreciation would be needed to restore a sustainable position (Jim O'Neill, Michael Rosenberg, and Catherine Mann), analyzes the impact of currency misalignments on each of the three major economies (Martin Baily for the United States, William Cline for Japan, and Daniel Gros for Euroland), and discusses the role of exchange market intervention in addressing the issues (Kathryn Dominguez, Edwin M. Truman, and Ernest Preeg).

Koreans living in the United States have generated an increase of about 15 to 20 percent in trade between the United States and Korea. This is one of the surprising conclusions reached in this special report, which, upon the 100th anniversary of the migration of Koreans from their homeland, looks at the impact of the 6 to 7 million people who make up this diaspora on both South Korean and overseas economies. No country in history has ever succeeded in building a developed and high-income economy without participating in the global economy; globalization is imperative for economic success. And one of the largest elements of globalization, in addition to international trade and investment, is migration. In The Korean Diaspora in the World Economy, experts hold up South Korea as one of the most dramatic examples of that experience, having gone from being a poor, underdeveloped country fewer than 40 years ago to becoming a postwar economic success story. This report also looks at South Korea's role as a regional trading partner and its present and future relations with North Korea.

For more than three decades, the United States has conducted a unique Japan-specific economic policy. This policy was motivated by Japan's economic size and dynamism, fears that a unique "Japanese model of capitalism" enabled it to compete unfairly and threaten American prosperity during a period of prolonged US economic difficulties, and that the United States had unique capabilities to induce policy change in Japan due to its provision of security guarantees. No More Bashing argues that these assessments are mistaken and that the United States should abandon its Japan-specific policy. Japan's declining relative importance in the world economy, the waning distinctiveness of its economic institutions, the failure of most recent US initiatives toward Japan, and the emergence of strengthened international institutions such as the World Trade Organization, all underscore the advisability of formulating new approaches to bilateral relations rooted more firmly in multilateral institutions. This volume analyzes the outlook for the Japanese and US economies; their trade and financial relationships, including their trade negotiations over the past decade; the implications of new regional developments, most notably the rise of China and proposals for East Asian economic cooperation; and the roles of the United States and Japan in the provision of international public goods such as development assistance, environmental protection, and international security. It emphasizes that their trade agenda is increasingly moving beyond traditional border impediments toward the more politically sensitive issues of internal regulation and deregulation, such as competition policy. The authors propose a series of new initiatives to address these challenges and strengthen the multilateral system.

The terrain of the world trading system is shifting as countries in Asia, Europe, and North America negotiate new trade agreements. However, none of these talks include both China and the United States, the two biggest economies in the world. In this pathbreaking study, C. Fred Bergsten, Gary Clyde Hufbauer, and Sean Miner argue that China and the United States would benefit substantially from a bilateral free trade and investment accord or from participating together in a regional agreement like the TPP. In the process, they contend, each country would also achieve progress in addressing its internal economic challenges, such as the low saving rate in the United States. Achieving greater trade and investment integration could be accomplished with one comprehensive effort or through step-by-step negotiations over key issues. The authors call on the United States to seek liberalization of China's services sector as vital to securing an agreement, and they explain that such contentious matters as cyberespionage and currency manipulation be handled through parallel negotiations rather than in the agreement itself. This is an important study of the benefits and difficulties of a complex matter that could yield dividends to the two economies and help stabilize the security and well-being of the rest of the world.

This volume contains the papers presented and comments made at two conferences on the controversial subject of greater flexibility of exchange rates. The first of the conferences was held at Oyster Bay, New York, early in 1969, the second at Burgenstock, Switzerland, in the summer of 1969. One half of the 40 conferees were academic economists, the others were practitioners of the foreign exchange markets, mostly bankers and a few executives of international business firms. Both the opposition to greater flexibility of exchange rates and the advocacy of more flexible systems are represented in these papers. The contrast between fixed or jumping exchange rates and gliding exchange rates is clearly described and the various systems of increased flexibility, such as the "wider band" and the "crawling peg," are explained and examined. Originally published in 1970. The Princeton Legacy Library uses the latest print-on-demand technology to again make available previously out-of-print books from the distinguished backlist of Princeton University Press. These editions preserve the original texts of these important books while presenting them in durable paperback and hardcover editions. The goal of the Princeton Legacy Library is to vastly increase access to the rich scholarly heritage found in the thousands of books published by Princeton University Press since its founding in 1905.

This volume contains the papers presented and comments made at two conferences on the controversial subject of greater flexibility of exchange rates. The first of the conferences was held at Oyster Bay, New York, early in 1969, the second at Burgenstock, Switzerland, in the summer of 1969. One half of the 40 conferees were academic economists, the others were practitioners of the foreign exchange markets, mostly bankers and a few executives of international business firms. Both the opposition to greater flexibility of exchange rates and the advocacy of more flexible systems are represented in these papers. The contrast between fixed or jumping exchange rates and gliding exchange rates is clearly described and the various systems of increased flexibility, such as the "wider band" and the "crawling peg," are explained and examined. Originally published in 1970. The Princeton Legacy Library uses the latest print-on-demand technology to again make available previously out-of-print books from the distinguished backlist of Princeton University Press. These editions preserve the original texts of these important books while presenting them in durable paperback and hardcover editions. The goal of the Princeton Legacy Library is to vastly increase access to the rich scholarly heritage found in the thousands of books published by Princeton University Press since its founding in 1905.

The decline of the dollar, the Mexican crisis, and sluggish global growth reveal the failure of the Group of Seven industrial nations to provide effective management of the world economy. The G-7 once played this crucial role effectively, and must do so again if future crises are to be averted and global prosperity to be promoted. This study assesses the G-7's record and the reasons for its demise. It outlines an action program that includes reforming the exchange rate regime, creating a new financial facility at the IMF to deal with crises sparked by private capital flows, and instituting an early warning system to prevent serious new disruptions in the world economy

China has emerged as an economic powerhouse (projected to have the largest economy in the world in a little over a decade) and is taking an ever-increasing role on the world stage. China's Rise: Challenges and Opportunities will help the United States and the rest of the world better comprehend the facts and dynamics underpinning China's rise-an understanding that becomes more and more important with each passing day. Additionally, the authors suggest actions both China and the United States can take that will not only maximize the opportunities for China's constructive integration into the international community but also help form a domestic consensus that will provide a stable foundation for such policies. Filled with facts for policymakers, this much anticipated book's narrative-driven, accessible style will appeal to the general reader. This book is unique in that it analyzes the authoritative data on China's economy, foreign and domestic policy, and national security. The expert judgments in this book paint a picture of a China confronting domestic challenges that are in many ways side effects of its economic successes, while simultaneously trying to take advantage of the foreign policy benefits of those same successes.China's Rise: Challenges and Opportunities from The China Balance Sheet Project, a joint, multiyear project of the Center for Strategic and International Studies and the Peterson Institute, discusses China's military modernization, China's increasing soft power influence in Asia and around the world, China's policy toward Taiwan, domestic political development, Beijing's political relations with China's provincial and municipal authorities, corruption and social unrest, rebalancing China's economic growth, the exchange rate controversy, energy and the environment, industrial policy, trade disputes, and investment issues. This book is part of the CSIS-IIE China Balance Sheet project. For more information about this project, please visit www.chinabalancesheet.org.