The 1893 Bank Crashes and Monetary Aggregates
AbstractThe paper explores the effects of the reconstruction schemes of the twelve banks of issue which suspended payment in early 1893 on the behaviour of monetary aggregates. Earlier estimates of narrow and broad measures of money seriously underestimate the contraction in the money stock by not netting out all of the significant proportion of deposit liabilities whose terms of maturity are so lengthened that they are effectively debentures. The paper proceeds by discussing the treatment of this matter in earlier calculations of the money stock. It then constructs an amended series that adjusts for the ‘locked up’ deposit liabilities and interminable deposit stock. Finally, a further adjustment is made by calculating the market value of the deferred deposit receipts and adding that back into the money supply. Thus a lower and upper bound of an alternative series of Australian monetary aggregates is provided.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Reserve Bank of Australia in its series RBA Research Discussion Papers with number rdp9303.
Date of creation: Apr 1993
Date of revision:
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Philip Cagan, 1965. "Determinants and Effects of Changes in the Stock of Money, 1875-1960," NBER Books, National Bureau of Economic Research, Inc, number caga65-1, May.
- Schedvin, C B, 1973. "A Century of Money in Australia," The Economic Record, The Economic Society of Australia, vol. 49(128), pages 588-605, December.
- Chay Fisher & Christopher Kent, 1999. "Two Depressions, One Banking Collapse," RBA Research Discussion Papers rdp1999-06, Reserve Bank of Australia.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Paula Drew).
If references are entirely missing, you can add them using this form.