What are the main global institutions? And how do they relate to international trade?
Background: international trade and the problem with world currencies
During the 1920s and 1030s, the world’s leading economies went through a major downturn in economic activity. Much, but not all, of this was due to the economic policies of individual nations that were intended to protect home nation manufacturing at the expense of international trade. But the outcome of such policies was a period of major economic difficulty. Countries therefore resolved to find another way to settle their problems and met together at Breton Woods in the USA in 1944.
The outcome of Breton Woods was the International Monetary System: this was an institutional arrangement amongst banks that belong to the International Monetary Fund (IMF). A number of leading governments agreed that international trade would be enhanced by promoting a system of fixed exchange rates between their currencies: the Breton Woods Agreement. The same meeting also resulted in the formation of the World Bank.