Exorbitant privilege and compulsory duty: the two faces of the financialised IMS

Aiming at analysing the constraints to economic development, the article takes as reference the classic Economic Commission for Latin America and the Caribbean (ECLAC) approach to centre–periphery relations and seeks to update it from two points of view: adding the new historical context of the financialisation of capitalism and highlighting the new format and operation of the International Monetary System (IMS). The article’s objective is thus analysing the effects of financialisation on the IMS, emphasising the hierarchies of this system and its consequences for the economic dynamic of centre and peripheral countries. The main hypothesis is that financialisation has produced changes in cross-border capital flows, but also – and chiefly – in the ‘nature’ of the key-currency of the IMS. As a consequence, the exorbitant privilege of the reserve currency issuing country reaches a paroxysm, while peripheral countries are victims of a ‘compulsory duty’.