Parallel Journeys: Adam Smith and Milton Friedman on the Regulation of Banking
AbstractAdam Smith and Milton Friedman are famous for championing Laissez Faire, yet both supported government regulation of the banking system. In both cases their deviation from free market orthodoxy was based on a careful reading of financial history: especially Smith's reading of the Crisis of 1772 and Friedman's reading of the Crisis of 1929-33. In both cases they based their reading on a complex and nuanced account of human nature. This paper describes their parallel journeys to the conclusion that banking requires government regulation.
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Bibliographic InfoPaper provided by Rutgers University, Department of Economics in its series Departmental Working Papers with number 201004.
Length: 20 pages
Date of creation: 19 Mar 2010
Date of revision:
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More information through EDIRC
banking; Adam Smith; Milton Friedman;
Find related papers by JEL classification:
- B10 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-07-17 (All new papers)
- NEP-BAN-2010-07-17 (Banking)
- NEP-HIS-2010-07-17 (Business, Economic & Financial History)
- NEP-HPE-2010-07-17 (History & Philosophy of Economics)
- NEP-REG-2010-07-17 (Regulation)
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