The Dollar and US Power

Today the US dollar is undoubtedly the top international currency. This is true by any of the conventional measures, for its public or private international roles, whether it is measured as unit of account, medium of exchange, or store of value (the three traditional roles of money). The first part of the paper is devoted to justifying this assertion. The second part of the paper then goes on to ask whether this is likely to continue in the medium term, and concludes that it is. The third part of the paper asks whether this widespread use of the dollar confers great privileges in terms of US power in the world, and concludes that the main source of advantage stems from private rather than public use of the dollar.