In 1963 Machlup convened the first conference of scholars at Villa Serbelloni owned by the Rockefeller Foundation in Bellagio. After the first four conferences, he published International Monetary Arrangement which he which it shared with the IMF and G10.

Over the next 13 years the group met 18 times. In the 60s and 70s the Bellagio group was the epicenter of international monetary discussions. It helped to bring the Bretton Woods system to an end by proposing viable alternative monetary regimes, including a flexible currency system which took over the gold standard when the United States abolished gold convertibility in 1971. Since 1965, he repeatedly spoke out against the Gold Standard.