Bitbobb,
You were referring "
bancor" as the academic predecessor of Special Drawing Rights.
John Maynard Keynes and Ernst Friedrich Schumacher proposed the concept of supranational currency - bancor, that would replace gold in international trade. It was intended as an unit of account to value and clear trade flows, through the multilateral clearing system - International Clearing Union. Each nation would have a limit of bancor, corresponding to its share in global trade. The scope of bancor was to achieve balanced trade among countries and enforce multilateral economic relations - going from bilateral relations to economic regionalism. At that age, bilateral relations were represented among colonies and the metropole (United Kingdom or France) and the ICU implementation would have brought globalization faster.
Gold could have been exchanged for bancor, but not vice-versa. Bancor was never meant as value of store, like physical gold.
Export increases the bancor balance, import - decreases and the mechanism incentivizes a zero balance: the surplus would have been partially held/retained to the ICU Reserve Fund and the deficit would have led to devaluation of the national currency, to become export-competitive and bring the balance back to zero. Rather than being fined, a country would boost its export or import.
It supposed fixed exchange rate between bancor and each national currency. The rate would have been revised when the country crossed the limit of bancor - surplus countries should appreciate the currency, deficit countries - depreciate the currency.
Similar to actual IMF, indebted countries would be under severe financial discipline. Unlike the actual IMF, wealthy, surplus nations would also be under scrutiny and required to implement tight monetary policies.
Multilateral Clearing (Economica Journal, 1943):
http://www.centerforneweconomics.org/documents/copy-e-f-schumacher-multilateral-clearing-economica-new-series-vol-10-no-38-may-1943-pp-15Wikipedia:
https://en.wikipedia.org/wiki/Bancor,
https://en.wikipedia.org/wiki/International_Clearing_UnionMy opinion:
IMF has a broader scope than ICU would have had.
From my POV, IMF focuses more on financial stability rather than trade balance and emphasizes the role of international capital flows. IMF decisions are political decisions, because the SDR is an instrument of higher flexibility than bancor would have been and the strong bends rules to favor him. I tend to see bancor as a self-adjusting mechanism (even a smart-contract), where the decisions are made upon economic performance, not political influence.
It is unclear how would have changed the total amount of banco in response to global GDP increasing. Each country needs higher limit to meet increased export/import volume - either new bancors are issued according the global trade % increase, or each national currency buys less bancor, i.e. bancor become more valuable.
Another sweetspot of bancor for libertarians would be the detachment from any government money. Bancor would not depend on one or 5 currencies.
On one hand, ICU and bancor would have smoothened the income inequality among nations. On the other hand, it would have limited credit issuance and I strongly consider credit a good for the humanity. Debt has a lot of negative consequences when mishandled, but it also drives progress - allowing for expansion and setting higher goals to attain.
Merry Christmas.
