This paper constructs a theoretical model to show how the credibility of a country’s commitment to an international gold standard regime is driven by fundamental determinants such as: 1) shifts in domestic policy, 2) a breakdown in cooperation between central banks, and 3) unilateral...

This paper addresses two questions. First, what causes the paper-bill spread to vary over time in anticipation of income fluctuations’? Second, why has the predictive power of the spread declined in recent years? Consistent with previous empirical work, the paper provides evidence for the...