Development and Underdevelopment in the History of Economic Thought

Nicholas Kaldor's Bancor, an international commodity currency (1964)

de Largentaye Hélène, Independent researcher

The status of the dollar as an international means of payment, standard of value and monetary reserve has increasingly been questioned since General de Gaulle’s 1964 press conference on the future of the international monetary system and even more since the collapse of the Bretton Woods system in 1971. At the opening session of the 1964 United Nations Conference on Trade and Development (UNCTAD) , the economist Nicholas Kaldor (1908 -1986) , presented a memorandum ( co-signed with Jan Tinbergen and Albert G. Hart), “ An International Currency: the Bancor” . Kaldor's bancor was a "tabular" standard, in other words a standard representing a set of commodities. He presents his scheme, first, as a way of increasing international liquidities, second, as an instrument for stabilising prices of commodities and lastly as a policy for promoting growth worldwide and in particular in less developed countries prominently depending on their exports of raw materials. What was the genesis of Kaldor’s Bancor? Who were its forefathers? Benjamin Graham advocated a commodity currency in his 1930s writings in view of fighting deflation. Keynes advocated an international tabular standard in his Treatise on Money (1930). What was the reception in Europe, in the United States and in less developed countries of Kaldor’s 1964 scheme in the following decades of the 20th century? Why was it abandoned by UNCTAD and hardly ever put forward again? Today, in the 21st century, is there any future for an international commodity currency as an alternative to the gold standard, the dollar standard or other types of purely fiat standards?

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Keywords: International Monetary System, Commodity Curreny, Bancor, Kaldor, UNCTAD