ABSTRACT
THE study of the rates of exchange, which at one time attracted so much practical and theoretical interest, had been almost entirely neglected by economists during the decades immediately preceding the war. We do not have to look far for the reason. As a consequence of the general adoption of the gold standard-or of the 'gold exchange standard,' which is similar in its action and effect-the rates of exchange between the different countries hardly fluctuated at all, except within the margin of the 'gold points,' and that margin was certainly becoming narrower with the easing of intercommunication. It is true that there were still matters calling for explanation in the fluctuation of rates of exchange within those limits: why it was, for instance, that in the case of certain countries the rate stood, on an average, rather below par, while in the case of other countries it was rather above par, and so on; but that problem was really of too little economic interest to be the object of more thorough investigation.
