The Bretton Woods System was designed to avoid the 'beggar-thy-neighbor' policies of the 1930s, which included:
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Correct answer: Competitive currency devaluations and high protective import tariffs
During the Depression, nations devalued their currencies to make exports cheaper, which triggered retaliatory tariffs and a collapse in global trade. Bretton Woods established rules to prevent such unilateral economic warfare.
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More Bretton Woods System questions
- Which of the following was a major criticism of the Bretton Woods institutions by developing 'Global South' nations?
- What role did the General Agreement on Tariffs and Trade (GATT) play alongside the Bretton Woods System?
- How did the Marshall Plan interact with the early Bretton Woods System?
- The term 'adjustable peg' in the context of Bretton Woods meant that:
- Why did France, under Charles de Gaulle, famously challenge the Bretton Woods System in the 1960s?
- Following the collapse of the Bretton Woods exchange rate system in 1973, most major currencies moved to: