International Accumulation and the Contradictions of National Monetary Policy

Abstract

With the international mobility of money, and the integration of national capital markets, the role of nation states in securing the money system becomes ambiguous, for nation states can exert only a partial impact on the value of (internationalized) money. The effect is that national monetary policy comes to reflect the contradictions between different sections of capital which are themselves integrated into international accumulation in different ways. A consequence is that there can be no assumption (as found in the conventional analysis) that national monetary policy is inherently nationalistic in its objectives. Hence the shifting emphasis in monetary policy between the exchange rate, the interest rate, the inflation rate, etc., is to be read as changing relations between different sections of capital in international accumulation. Increasingly, national monetary policy is drawing on policies which secure wage reductions, so as to secure the monetary system without dividing capital.