For half a century, the United States has garnered substantial political and economic benefits as a result of the dollar's de facto role as a global currency. In recent years, however, the dollar's dominant position in world markets has been challenged. The dollar has been more volatile than ever against foreign currencies, and various nations have switched to non-dollar instruments in their transactions. China and the Arab Gulf states continue to hold massive amounts of US government obligations, in effect subsidizing American current account deficits, and those holdings are a point of potential vulnerability for the United States.

What is the future of the US dollar as an international currency? Will predictions of its demise prove just as inaccurate as those that have accompanied major international financial crises since the early 1970s? Analysts disagree, often profoundly, in their answers to these questions. In The Future of the Dollar, leading scholars of the dollar's international role bring multidisciplinary perspectives and a range of contrasting predictions to the question of the dollar's future. This timely book provides readers with a clear sense of why such disagreements exist and outlines a variety of future scenarios and possible political implications for the United States and the world.

This is a superb and timely volume, displaying the insights of political scientists and economists. It should be read by members of both disciplines and everyone else interested in the future of the international monetary system. — Peter B. Kenen, Walker Professor of Economics and International Finance Emeritus, Princeton University