could evolve . A monetary system is a system by which a government provides money in a country’s economy. The system was designed to establish economic stability for the nations emerging from the ravages of the war, as well as promote trade by increasing the. Using a newly compiled database of individual economies’ reserve holdings by currency, this paper finds that financial links have been an increasingly important driver of reserve currency configurations since the global financial. Brahima Coulibaly and Eswar Prasad make the case for an international monetary and financial system that is fit for purpose to help countries better withstand shocks like a global pandemic. The needMoney is anything that serves as a medium of exchange. Conversely, both forms of commercial payments (B2B and B2C). Understand the role and purpose of the international monetary system as well as its relevance for global professionals. A monetary standard is a set of institutions and rules governing the supply of money in an economy. Describe the Bretton Woods Agreement and why it collapsed. S. Monetary Policy. S. the system…. The primary objectives of monetary policies are the management of inflation or unemployment and maintenance of currency exchange rates. The monetary systems of various countries are regulated by the international legislation; 2. Sterling was international money. dollar. Between. Market economies pegged their currencies to the U. With. In this literature, the monetary system is under-stood as a global payments system in which all money is credit money, whether physically printed or not. Cryptocurrency. Expansionary monetary policy is one wherein the central bank lowers interest rates to promote credit availability in an economy. Every government has enough power to control the local economy. 37. This system has rules and regulations which help in computing the exchange rate and terms of. 1. About the IMF The IMF is a global organization that works to achieve sustainable growth and prosperity for all of its 190 member countries. monetary system If we had no debts in our global monetary system, no money could. 1. Outline of Monetary Policy. monetary system is, however, gradually becoming more multipolar. $21. . Central banks in many advanced economies set explicit inflation targets. It considers the underlying causes – German. By that time, inflation in the United States and a growing American trade deficit were undermining the value of the dollar. Since lending in a modern fractional reserve banking system actually creates "new" money, discouraging lending slows the rate of monetary growth and inflation. American money has depicted Liberty and Justice as allergorical figures. This arrangement aimed to prevent significant exchange rate fluctuations and stabilize inflation. It boosts economic growth. S. Cover photo by. org. The problems of the monetary system tend to be a geographic mismatch in theMost notable, two historic institutions emerged from that conference: the World Bank and the International Monetary Fund (IMF). So, higher interest rates through contractionary policy can be used to dampen inflation and move the economy back to the price stability component of the dual mandate. Keynesian economics was developed by the British economist John Maynard Keynes. M1 and M2 money have several definitions, ranging from narrow to broad. For example, a central bank may set a target for the interest rate at which banks may lend their surplus reserves to other banks. It is also clearly written in. Central bank digital currencies (CBDCs) offer in digital form the unique advantages of central bank money: settlement finality, liquidity and integrity. banking system collapsed leading to the Great Recession of 2007-2008, the. Silver Standard: A monetary system in which a country's government allows its currency to be freely converted into fixed amounts of silver, and vice versa. This paper analyzes the historical evolution of the international monetary system in the context of the rising role of developing countries in the world economy and the emerging multi-polar growth setting. , the central bank, the Federal Reserve, is in charge of. In July 1944 at Bretton Woods, New Hampshire, the forty-four countries constituting the Allies fighting the Axis powers constructed a blueprint for the post-World War II international monetary system. In a review conducted over 2019 and 2020, the Fed took a step back to consider whether. C. Monetary policy, measures employed by governments to influence economic activity, specifically by manipulating the supplies of money and credit and by altering rates of interest. Abstract IN recent years, there has been increasing discussion in official, financial, and academic circles of the present international monetary system. Department of the Treasury to oversee the issuance of National Banknotes. Let’s take a look at the last century of the international monetary system evolution. Fiat money is a type of currency that is not backed by a commodity, such as gold or silver. It plays a vital role in inflation and deflation control and forms the basis of all economic activities, allowing balanced business growth. This system comprises a spectrum of customary institutional and legal arrangements which govern the conduct of international economic transactions, the methods of financing deficits and surpluses in. Usually, these include the national treasury, the central and commercial banks, and the mint. Louis. A well-functioning international monetary system is a public good that is essential for economic and financial stability. As an economy gets closer to producing at full capacity, increasing demand will put. The U. Abstract. Part 1 is devoted to the basic functioning and purposes of the purchase and sale policies Central Banks undertake:In this monetary system, the standard unit of currency is typically kept at the value of a fixed quantity of gold, which increases confidence in international trade by preventing governments from excessively issuing currency. It also evaluates the main scenarios and trends that is being discussed since the global crisis – selecting the relevant authors, journals, institutions and opinions – examines present. Among its many functions, the central bank issues the economy’s unit of account and ensures the finality of payments through settlement on its balance sheet. dollar and the euro for cross-border payments remains limited, rapid technological (e. THE MONETARY SYSTEM. For example, when the U. It consists of the following rules. The American Founding Fathers originally intended a monetary system quite different from the one we have now. Upload. The system will continue to rely on mechanisms allowing for effective and. Furthermore, this innovative method allows for many ongoing. ways that the government can influence the. It takes time for our policy decisions to filter—or be transmitted—through the economy and financial system. Interest Rates A monetary authority may set targets for foundational interest rates that are intended to influence all interest rates. United States portal v t e The Headquarters of the Federal Reserve System in Washington, D. monetary system definition: 1. Output. Globalizing Capital is a good introduction to the international monetary system, and a decent review for the already familiar who want to revise their knowledge. Reflecting the perception at the time that the Depression-era “competitive devaluations. The European Monetary System (EMS) was a multilateral adjustable exchange rate agreement in which most of the nations of the European Economic Community (EEC) linked their currencies to prevent large fluctuations in relative value. In other words, in such a monetary system, gold. Such institutions include the mint, the central bank, treasury, and other financial institutions. S. This i s a comprehensive study of the workings of the system in. S. The key question concerning the international monetary system is whether it can function in a manner that promotes global economic and financial stability rather than become a source of. is open market operations. fund the initiatives of the United Nations. M1 = coins and currency in circulation + checkable (demand) deposit + traveler’s checks. An international monetary system is a set of internationally agreed rules, conventions and supporting institutions that facilitate international trade, cross border investment and. For the foreseeable future, there are no candidates . Important facts about the Monetary System in India. The EMS aimed to create a stable exchange rate for easier trade and cooperation among European countries through. Once dismissed as a fringe interest of tech evangelists, cryptocurrencies—particularly Bitcoin—have skyrocketed to mainstream popularity and trillion dollar valuations. This system has rules and regulations which help in computing the exchange rate and. 1 The report, submitted semiannually to the Congress, is delivered concurrently with testimony from the Federal Reserve Board Chair. Monetarism is an economic theory that says the money supply is the most important driver of economic growth. Forest of Compiègne is famous as the site of Armistice between the Allies and Germany which ended World War I on 11 November 1918 to discuss the International Monetary System. dollar as the global currency. It comprises commodities having intrinsic values or precious metals and minerals. the system…. Read how the Bank of Canada controls inflation and contributes to Canada’s economic and financial welfare. THE MONETARY SYSTEM. 37. We propose a simple model of the international monetary system. Alexander Hamilton establishes the Bank of the United States to create a system of credit for the government. Fiat money is a type of currency that is not backed by a commodity, such as gold or silver. U. ] When a little over two years ago, at the second Lausanne Conference of this group, I threw out, almost as a sort of. And this sort of transition. Federal Reserve History essay: Launch of the Bretton Woods System; St. 614. 4. R. The international monetary system is a governing body that sets the rules and regulations by which different nations exchange currencies with each other. A monetary system refers to the process to provide money to an economy. international monetary system away from a US-dominated system toward one that is more regionally based and in which developing countries have a major say. D. There’s a real mismatch between where the financial system is going and where investment is needed to change our global energy systems. While it sounds like a good idea, there are more cons than pros. A great visual explanation of how monetary systems work. They come in 1000, 2000, 5,000, 10,000, 20,000 and 50,000 colones denominations. 1 – Banks as Financial Intermediaries Banks act as financial intermediaries because they stand between savers and borrowers. During the 20th century, the international monetary system underwent major. 25, and that’s important to remember because many currencies use commas to separate cents from the main amount, but in the USA. While the global usage of currencies other than the U. Money Supply M3 and M4. In open market operations (OMO), the Federal. Monetary Aggregates Explained. par value system. Ladies and gentlemen, friends, Let me start by thanking the Atlantic Council for providing a fitting venue to discuss central banks’ forays into Digital Currencies. BRETTONWOODS SYSTEM . Challenge 2 - Sophia Milestone. Define monetary system. The budget system had three layers — central, regional, and municipal — but, like the Soviet state, it too was unitary. The first is the creation of the International Monetary Fund at the Bretton Woods conference. It is typically designated by the issuing government to be legal tender, and is authorized by government regulation. In the final section, I argue that the modern international monetary system, with its emphasis on the prob lem of adjustment between states, was an unintended product of these domestic measures. ECO 202 Wk 4 Quiz Monetary System Web Page. It deals with changes in the money supply of a nation by adjusting interest rates, reserve requirements, and open market operations. Contrary to the decentralisation. From the end of World War II to the early 1970s, the United States was part of the international monetary system known as the Bretton Woods system. This report describes how such a Sovereign Money system could be implemented and what steps would be required for a successful transition. Learn more. PK ! K^x² Ñ+ [Content_Types]. 2 The impact of central bank digital currency on the whole economy system. 2: Suppose the USD/Swiss franc (CHF) exchange rate is . Submit Search. Macroeconomics 100% (18) 6. The BIS Annual Report explores the challenges and opportunities of the monetary system in the digital era, and how to build on central bank public goods to. In implementing monetary policy, the Bank influences the formation of interest. The paper is divided into six sections, the first of which is this introduction. On the one hand, the evolving needs and demands of society have spurred the monetary system to adapt. The bottom line. S. To help guide central banks in exploring and developing CBDC, we’ve established a step-by. This pool,. Bank Capital, Leverage, and the Financial Crisis of 2008-2009 i. Both monetary and fiscal policy are macroeconomic tools used to manage or stimulate the economy. 1. The intimate links between the rise and fall of great powers and the international monetary and financial system are what make studying the latter so fascinating. Follow • 19 likes •. S. ) Monetary System is the government policy and framework which creates money for the local economy. The Berkeley View If the Harvard view is fundamentally empirical, then the Berkeley view is fundamentally historical. S. Treasury bonds in order to influence the quantity of bank reserves and the level of interest rates. currency and balances held in checking accounts and savings accounts are included in many measures of the money supply. The international monetary system will continue to rely on rules and conventions covering, for instance, monetary and exchange-rate arrangements; cross-border payments for capital-account transactions; and capital flows and related management measures. A. That unique monetary system, along with such things as the absence of an income tax, a welfare state, and a warfare state, along with open immigration, contributed to the tremendous economic prosperity that pulled. The effect of this currency exchange here in Utah is the impact on Utah’s contribution to the economy of the United States in the travel and tourism industry. We need the rules of the world economy to be wired toward our climate goals. Expansionary monetary policy increases the growth of the economy, while contractionary policy slows economic growth. Revenues from cross-border consumer payments—both C2B and C2C—increased at double-digit rates, accelerating from high single digits in 2021. It would be a new way of connecting people, markets, and economies in the digital world. Monetary policy, one of the tools governments have to affect the overall performance of the economy, uses. The function of storing value of money can be described. ” A new more multipolar monetary system is instead likely to gradually emerge as a result of the increase in bilateral trade of many countries, the deepening of local capital markets in emerging countries and efforts to develop mutual insurance schemes against shocks resulting from shifts in US monetary policy. As such, it establishes the basis for the discussion of monetary policy, banking supervision, and financial stability in the following chapters. writing in a Due Diligence Anti-Money Laundering Compliance form that “we use IP blocking to deny business from sanctioned countries. the system of money used by a country or countries: European/global/international, etc. the system used by a country to provide money and to control the exchange of money 2. C. Effective monetary sovereignty fits the existing hybrid monetary system, in which central banks issue public money as a low-risk instrument, while more risky lending is left to private institutions. Using a newly compiled database of individual economies’ reserve holdings by currency, this paper finds that financial links have been an increasingly important driver of reserve currency. monetary system meaning: 1. It does so by supporting economic policies that promote financial stability and monetary cooperation, which are essential to increase productivity, job creation, and economic well-being. Monetary Policy 101. We aren’t “capitalist” in terms of a monetary system. This system comprises a spectrum of customary institutional and legal arrangements which govern the conduct of international economic transactions, the methods of financing deficits and surpluses in. 2. v. Yet there was one constant feature: the system was almost always dominated by a single currency. As analyzed by Kindleberger(1976): In the 19th century, Britain was the leader of the world economic system. In November 2021, the. Read how the Bank of Canada controls inflation and contributes to Canada’s economic and financial welfare. conditions and methods of functioning of money in the sphere of international r elations. A low level of inflation is considered to be healthy for the economy. But the global economy is evolving rapidly, and the IMS needs to adapt to the new reality. Resilient USD-centric monetary system. C. The Monetary System. For example, when the U. 2Abstract IN recent years, there has been increasing discussion in official, financial, and academic circles of the present international monetary system. to replace the US dollar as lead currency, and the . The purpose is to provide some initial thoughts for further research on the three key questions mentioned above without providing a definitive policy proposal at this stage. Competitive Money Supply: The International Monetary System in Perspective 11. iii. e. The bank is the first of several in the country to issue private currencies facilitating borrowing and lending. dollar, the euro, and renminbi”. February 9, 2022. The international monetary system has evolved as governments' needs have changed and as these governments respond to domestic and international conditions. Prior to World War I, capital flowed freely and the gold standard guaranteed stable exchange rates. The international monetary system is the set of rules, institutions, and treaties defining the . Monetary Theory: A monetary theory is a set of ideas about how monetary policy should be conducted within an economy. Fast Money: The Egyptian Economy, Monetary System, and Horrendous Taxes. What does monetary system mean? Information and translations of monetary. This page titled 27: The Monetary System is shared under a not declared license and was authored, remixed, and/or curated by Boundless. The monetary systems of various countries are regulated by the international legislation; 2. S. The Fed may use expansionary monetary policy to provide stimulus for the economy, and may use contractionary monetary policy to bring inflation back toward its target. American paper currency comes in seven denominations: $1, $2, $5, $10, $20, $50, and $100. Footnote 70 A similar position is held by the European Central Bank, according to whom “… the international monetary system is already on the verge. 1:46. The International Monetary System "Currency Power and International Security," Fletcher Security Review, 8: 1 (2021). How the monetary system . monetary system and “can better reconcile reasonably free and open markets with independent national policies [and] stability,” the sensible goal called for by Volcker (2014). All of the following statements are valid and don’t require the presence of a monetary system. In recent years, the changes in the global economy, economic policy responses, and the geopolitical. Expansionary monetary policy is when a central bank uses its tools to stimulate the economy. The Bretton Woods system lasted until 1971. The Bretton Woods Agreements: A Monetary Theory Perspective PART. the system used by a country to provide money and to control the exchange of money 2. International monetary system refers to the system and rules that govern the use and exchange of money around the world and between countries. The Relationship between M1 and M2 Money. xml ¢ ( Ìš]oÚ0 †ï'í?D¹ HÈW×M@/öqµ Jí~€— [b[±éÊ¿Ÿ“@—UPh õrƒpìsüX ç âÉÕ}]ywÔ¨Rð© cß#ž‹¢ä‹©ÿãöóèÒ÷”f¼`•à4õפü«ÙëW“Ûµ$å™h®¦þRkù> U¾¤š©@Hâ¦g. Identify the currency that was convertible to gold under the Bretton Woods system. The European Monetary System (EMS) refers to an arrangement established in 1979, whereby members of the European Economic Community (now the European Union) agreed to link their currencies to encourage monetary stability in Europe. “Monetary Policy and Central Banking. Its forerunners include the architects of the Chicago Plan in the 1930s (see Box 5. This interplay has been a story of one side pulling the other, leading to dramatic leaps in economic activity over time. The IMF's main purpose is to stabilize the international monetary system and oversee the world's currencies. S. Even the closed monetary system was retained until 296 CE. Subscribers to the theory believe that money supply is a primary determinant of price levels and inflation. Sterling was international money. There’s a real mismatch between where the financial system is going and where investment is needed to change our global energy systems. The Federal Reserve. For more videos: supply refers to the cash and cash equivalents in a country at a given point in time. Fiat money generally does not have. The Bretton Woods Agreements: A Monetary Theory Perspective PART. 1: Introducing Money. "A Closer Look at Open Market Operations. Commodity: Commodity money is the oldest financial instrument. Essential reading for understanding the international economy―now thoroughly updated. A new more multipolar monetary system is instead likely to gradually emerge as a result of the increase in bilateral trade of many countries, the deepening of local capital markets in emerging countries and efforts to develop mutual insurance schemes against shocks resulting from shifts in US monetary policy. The value of fiat money is derived from the relationship between supply and. The EMS aimed to create a stable exchange rate for easier trade and cooperation among European countries. Although they may seem far removed from modern life, their inventions in the monetary realm provided the basis for many economic practices still in use today. ” Federal Reserve Bank of St. American economist Milton Friedman is generally regarded as monetarism’s leading exponent. There are two main kinds of monetary policy: contractionary and expansionary. Continue reading. Abstract. It evaluates the stability of the current "non-system" and how the global economic context is likely to affect that stability in. dollar. Exchange Rate Mechanism - ERM: An exchange rate mechanism is based on the concept of fixed currency exchange rate margins. Most people want to make more money, but very few know how money works. The major stages of the evolution of the international monetary system can be categorized into the following stages. In a Sovereign Money system, only the central bank, owned by the state, may create money. It adopts a political economy approach, emphasizing the economic and political conditions under which an international monetary system can come into existence and be maintained over time. AE Semis = half As or 6 uncia. Each country has its own currency as money and the international monetary system governs the rules for. A burst of creative innovation is under way in money and payments, opening up vistas of a future digital monetary system that adapts continuously to serve the public interest. to pave the way for the eventual European monetary union. The monetary authority of India is the Reserve Bank of India (RBI). In both cases, global disruption shook the monetary system and caused prolonged instability. ommercial banks would be prevented from creating money. Given the macroeconomic dangers of a malfunctioning banking system, Monetary Policy and Bank Regulation will discuss government policies for controlling the money supply and for keeping the banking system safe. The Costa Rican Money - the Colon is colorful and includes pictures of some of Costa's Rica's wildlife - sharks, monkeys, sloths and butterflies. THE ROMAN MONETARY SYSTEM The Roman monetary system was highly complex. One dollar is written as $1 or $1. S. Ultimately, greater use of the Fund’s Special Drawing Rights would. A review of those crises and the circumstances that gave rise to them is therefore. February 2021 Summary The gold standard is a monetary system in which paper money is freely convertible into a fixed amount of gold. Different measures of M3, M4 show strong growth (over 10%) until 2009, where growth rates fall. The third analyses the tensions that the Bretton Woods monetary system faced since the 1960s until its collapse in the early 1970s. The monetary system is a form of money circulation that has gone through a long path of origin and development, and its mechanisms and tools are different depending on the different levels of economic development of countries. By the early 1960s, the economist Robert Triffin had identified a major weakness in this system: the country that issued the global reserve currency (in this case, the United States) had to. The IMF will turn 75 this year. It gained prominence in the 1970s, but was mostly abandoned as a practical guidance to monetary policy during the following decade because the strategy was found to not work very well in practice. The Monetary System Prior to the system of coins, bars and rings of gold and silver were used as media of exchange by the Jews. Paper money. " What Does the International Currency System Really Look Like?," with Tabitha Benney, Review of International Political Economy (2014). Central banks use monetary policy to manage the supply of money in a country’s economy. The government uses the central bank to influence the monetary policy in the country. International monetary system refers to the system and rules that govern the use and exchange of money around the world and between countries. Monetary Systems and Monetary Theory 9. You are being redirected. 74 = CHF 1). International Monetary System (IMS) is a well-designed system that regulates the valuations and exchange of money across countries. Since its launch in 1944, the USD-centric monetary system has undergone radical change, typically in response to "systemic" crises such as. The international monetary system provides the institutional framework for determining the rules and procedures for international payments, determination of exchange rates, and. Cover photo by. A money system is not an economic system. Macroeconomics 100% (15) 8. Examples. What Is Monetary Policy? Monetary policy is an approach taken by a central bank or government authority that is intended to influence economic growth by expanding or constraining the supply of. They can be classified into three types: Commodity money, Commodity-based money, and Fiat money, the. Monetary Policy is generally the process by which. Off-monetary history of the period. By so doing, it established America as the dominant power in the world economy. The exchange rate between the weights of gold and silver was 1 to 13. Chapter III of the Annual Economic Report 2021. establish gold standard across the world D. … See moreA monetary system is a set of policies, frameworks, and institutions by which the government creates money in an. The money supply is commonly defined to be a group of safe assets that households and businesses can use to make payments or to hold as short-term investments. Resilient USD-centric. Central banks use monetary policy to manage the supply of money in a country’s economy. An exchange rate is the. Good timing is critical as monetary flows are unpredictable. They can control the amount of money which traffic in the market. . American economist Milton Friedman is generally regarded as monetarism’s leading exponent. In fact, they had hoped to prevent many of the fiscal and economic problems with which our present monetary system is afflicted. Central banks use monetary policy to manage economic fluctuations and achieve price stability, which means that inflation is low and stable. As shown below in Figure 1, the USD dominates global transactions across markets and between actors outside of the United States itself, “offshore. The Relationship between M1 and M2 Money. economy and, more generally, the public interest. With the assistance of the International Monetary Fund, countries. July 1944. Paperback. The heart of economic growth is an expanding subsistence fund, or the pool of real savings. C. First, there is a reason why China has not done more to elevate the renminbi as an international currency. It is fueling the fundamental dissonance. Includes paper bills that the public holds outside the monetary system c. Contractionary monetary policy: This type of policy is used to decrease the amount of money. In this period, the U. International monetary system refers to the system and rules that govern the use and exchange of money around the world and between countries. Money supply is one of the key tools in. However, the members of the European Economic Community wanted an exchange-rate agreement to complement their customs union. Learn about different types of monetary systems, such as commodity money, fiat money, and central bank money, and their historical and current features. The Monetary System - Download as a PDF or view online for free. , a deposit, against a loan or bond. The monetarist theory (also referred to as “monetarism”) is a fundamental macroeconomic theory that focuses on the importance of the money supply as a key economic force. all of the aboveThe National Monetary Commission was an outgrowth of crises that beset the pre–Federal Reserve monetary system. The banking system and the budget system were the two pillars of the monetary system. 9157 quietly entered the U. Monetary inflation is a sustained increase in the money supply of a country (or currency area). Monetary theory suggests that different monetary policies can benefit nations. Money creation takes place when a private or public institution expands its balance sheet and issues a new monetary instrument, e. Thus, the American experience of money has been very rich as it developed significantly in different era of. Open market operations take place when the central bank sells or buys U. The monetary system is the way a government provides money in a country’s economy. An early step. Forms of commodity money have been salt, beads, seashells, tobacco, silver, and gold. The U. The international monetary system provides the institutional framework for determining the rules and procedures for international payments, determination of exchange rates, and movement of capital. The New Monetary Economics and Keynes’ Theory of Money PART III: MONETARY SYSTEMS 8. Refers to the international monetary system in operation in the post-war period until the end of the gold exchange standard in 1971. In preparation for the monetary union, the EMS created the European Currency Unit (ECU), which. , is responsible for regulating the monetary system. 49 9 Used from $14. d. M1 is a metric for the money supply of a country and includes physical money — both paper and coin — as well as checking accounts , demand deposits and negotiable order of withdrawal (NOW. This lecture draws on his latest book, The Future of Money: How the Digital Revolution is Transforming Currencies and Finance. A crucial stimulus was the imposition of a poll-tax that had to be paid in coins, forcing the peasantry to sell their economic surplus for money. Since its launch in 1944, the USD-centric monetary system has undergone radical change, typically in response to "systemic" crises such as major shifts in US monetary policy that generated stresses outside the United States. NEW YORK – This year, the world commemorates the anniversaries of two key events in the development of the global monetary system. Chris Thomas Teacher. They currently exist in a small and experimental corner of the world’s financial markets, and are. The two types of systems are distinct from one another. Meaning of monetary system. These new standardized bronze denominations are known as “Aes Grave” and begin to form a monetary system that to this day still influences modern society. For the interpretation of relevant concepts of central bank digital currency, the most recognized definition is the currency issuance framework of "the money flower: a taxonomy of money " proposed by Bench and Garratt [], which defines its four major attributes:. In turn, the United States maintained the value of its dollar at $35 per ounce of gold. [1] Bimetallism, [a] also known as the bimetallic standard, is a monetary standard in which the value of the monetary unit is defined as equivalent to certain quantities of two metals, typically gold and silver, creating a fixed rate of exchange between them. The public goods consisted of a market for. Monetary System. Learn about the three types of monetary system: commodity money, commodity-based money and fiat money.