Answer: (1) Characteristics of the Jamaican system

The characteristics of the Jamaican system are: diversification of the international reserve system, legalization of floating exchange rates and diversification of the international balance of payments adjustment mechanism. For relevant introduction, please refer to the relevant content of "Review Notes" in this chapter.

(2) The dual role of the Jamaican system

①The positive role of the Jamaican system

The diversified international reserve system of the Jamaican system has solved the problem of " Triffin Dilemma”, the problem of “confidence and solvency”. The diversification of reserve currencies allows the benefits and risks of serving as an international reserve currency to be shared among multiple currencies. When a reserve currency depreciates and creates a crisis of confidence, its proportion in foreign exchange reserves will decrease, and a reserve currency with good confidence will increase its proportion. When the long-term deficit of a certain reserve currency country leads to insufficient international solvency, other reserve currencies will make up for this deficiency. Therefore, a diversified international reserve system can stably provide international solvency, so that the crisis of a single reserve currency will not affect the stability of the entire international monetary system.

②Disadvantages of the Jamaican system

a. Under the Jamaican system, each reserve currency issuing country enjoys the privilege of collecting "seigniorage" from other countries. Seigniorage refers to the free flow of actual resources from the country holding the currency into the country that issued the currency. In addition, the increase in international solvency still cannot fully meet the needs of balanced growth of the world economy. It not only lost the spontaneous adjustment mechanism under the gold standard system, but also failed to form the IMF's control over the growth of international solvency.

b. Under the floating exchange rate system, exchange rates fluctuate violently, which has a negative impact on international trade and investment. Since the price elasticity of import and export commodities in developing countries is not large, exchange rate fluctuations often have adverse effects on their domestic economies, and their own ability to prevent foreign exchange risks is poor, so developing countries hope to implement a relatively stable exchange rate system.

c. Under the Jamaican system, the imbalance of the international balance of payments is adjusted by the cooperation of a variety of adjustment mechanisms, mainly through the exchange rate mechanism, the interest rate mechanism, the adjustment of international financial institutions and the use of international reserve assets. Since various adjustment mechanisms in the Jamaican system have their limitations, and the lending capabilities of international financial institutions are limited, the balance of payments imbalance has not improved since 1973, but has become increasingly serious.

To sum up, the Jamaican system only partially legitimized the profound changes that actually occurred after the collapse of the Bretton Woods system, and did not carry out major reforms. The Jamaican system provides maximum flexibility in exchange rate arrangements, but does not establish an institution to stabilize the monetary system. It does not establish hard rules or automatic sanctions. Countries can fulfill their obligations based on their own considerations and responsibilities. Therefore, the Jamaican system is a "system without institutions", but in fact it operates on a floating exchange rate system and a multiple reserve system.