Dr. Dooley has written a paper that takes a look at how his Bretton Woods II framework has done since it was first proposed in 2003. It can be found here.
The revived Bretton Woods framework we proposed in 2003 remains a useful way to understand the international financial system. We document that the system survived the 2008 crisis. Looking forward, we argue that the system will continue to evolve as we expected. China is likely to graduate from the periphery to the center in the next few years. This graduation process could be smooth or associated with recurrent financial crises. During this transition the magnitude of net capital outflows from the periphery will continue to depress real interest rates in industrial countries at every phase of the business cycle. Finally, recent policy initiatives suggest that India is poised to replace China as the dominant periphery country.
The paper was covered in the press, with a focus on the model’s implicit forecast of continuing pain for western workers.