Proposed Title: Visibility, Process and Effects of Global Currency: A case study research on The Cooperation Council for the Arab States of the Gulf (CCASG)
The research will focus on global currency placing imperative views on its visibility, process and effects particular on the economic and political side, looking for detailed and comprehensive case study analysis towards the Arab States of the Gulf, how the latter may utilize global currency as put into effective stature and assumptions. Preliminary literature is important here detailing global currency, any salient information bases that is of value to the research focus, the execution of case surveys to be handed to the cooperation council authorities of the Arab States, this will be in survey based statements as put in a five point response ratio and scaling in following measures: a) Global currency and visibility b) Global currency and process c) Global currency and economic effects d) Global currency and political effects. The ratio will have to be in point 1 to point 5 system of strongly agree down to strongly disagree. Furthermore, selection of specific journals and articles is imperative for the research as it allows grounding nature and discussion analysis from case study research on the Cooperation Council for the Arab States of the Gulf
Amiably, when using national currencies in international trade, both flexible and fixed exchange rate systems pose number of problems. The most important is large deflationary bias on the global economy, as deficit countries are forced to try to attain positive current account balance to protect their exchange rate. There was a proponent who advances the Post Keynesian policy proposal (Moore, 2004) for common global currency, where exchange rates vanish and countries no longer have an external balance constraint. In order to move toward common world currency, two approaches has been considered: the top down approach, consisting of global central bank as it is politically unfeasible, and bottom-up approach, upon consisting of blocs of countries that chose to dollarize or euroize (Moore, 2004). The research will take account of certain dollarization and euroization plan for the global economy. The latter information would enable Arab States economies to pursue expansionary domestic policies since they would no longer face an external balance constraint. The Gulf Cooperation Council have some vivid plans to introduce global based single currency by the year 2010 into their six member states such as Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. The research study will then focus on selected macroeconomic and institutional issues and key policy choices which are likely to arise during the visible process as well as certain effects of monetary integration.
Research findings will be that there will be supranational Gulf Cooperation Council monetary institution as to be required to conduct single monetary and exchange rate policy geared to the economic, monetary and financial conditions into monetary union as a whole assumption, the Gulf Cooperation Council member states (Sturm and Siegfried, 2005). have already achieved remarkable degree of monetary convergence, but fiscal convergence remained such challenge and needs to be supported by appropriate fiscal policy framework as there is currently high degree of structural convergence, although the situation expected to diminish in view of the process of global dominance in Gulf Cooperation Council economies, which call for several adequate policy responses to recognize effective global currency (Sturm and Siegfried, 2005). Indeed, there will be impeding need to compare the dollar peg to dollar-euro basket peg as alternative exchange rate regimes for the incipient Gulf Cooperation Council currency union. Thus, quantitative evidence suggests basket peg does not dominate dollar peg for improving external stability. Aside, as Gulf Cooperation Council exports and external financial assets become more diversified, presence of a more flexible exchange policy may be necessary for competitiveness and stability. Pegging the prospective common Gulf Cooperation Council currency to a basket, like the dollar-euro basket, may provide conservative transitional strategy towards ideal and flexible exchange rate policy.
References
Moore, B. (2004) A global currency for a global economy. Journal of Post Keynesian Economics, Volume 26, Number 4 pp. 631 – 653
Sturm, M. and Siegfried, N. (2005). Regional Monetary Integration in the Member States of the Gulf Cooperation Council. June 2005 ECB Occasional Paper No. 31
Credit:ivythesis.typepad.com
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