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Ricardo's two monetary plans


  • Ghislain DELEPLACE



The paper compares the two monetary plans designed by Ricardo: the Ingot Plan of 1816, centred on the convertibility of Bank of England notes in bullion, and the Plan for a National Bank of 1823, which substitutes a public bank for the Bank of England as sole institution for issuing notes. Two questions are raised: Were these two plans compatible? Why did Ricardo switch from one to the other? The answers are looked for in Ricardo's defence before the Parliament in 1822-23, when he was accused of being responsible for the deflation having followed the resumption of note payments. I suggest that Ricardo switched from one plan to the other because he was convinced that the Bank of England had torpedoed the implementation of the first. From an analytical point of view however, Ricardo's adoption of the second did not mean that he gave up his initial objective: toseparate the ways the issuing bank handled domestic monetary circulation and foreign relations. In spite of different convertibility principles, the same device is used in both plans to attain that objective; it concerns the management by the issuing bank of its metallic reserve.

Suggested Citation

  • Ghislain DELEPLACE, 2008. "Ricardo's two monetary plans," Cahiers d’économie politique / Papers in Political Economy, L'Harmattan, issue 55, pages 13-33, July - De.
  • Handle: RePEc:cpo:journl:y:2008:i:55:p:13-33

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    References listed on IDEAS

    1. Olivier Godard, 1990. "Environnement, modes de coordination et systèmes de légitimité : analyse de la catégorie de patrimoine naturel," Revue Économique, Programme National Persée, vol. 41(2), pages 215-242.
    2. Claude Henry, 1984. "La microéconomie comme langage et enjeu de négociations," Revue Économique, Programme National Persée, vol. 35(1), pages 177-198.
    3. Thierry Hommel & Olivier Godard, 2002. "Trajectoire de contestabilité sociale et production d'OGM à usage agricole," Économie rurale, Programme National Persée, vol. 270(1), pages 36-49.
    4. Driessen, Peter P. J. & Glasbergen, Pieter & Verdaas, Co, 2001. "Interactive policy-making - a model of management for public works," European Journal of Operational Research, Elsevier, vol. 128(2), pages 322-337, January.
    5. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74, pages 132-132.
    6. Jean-Charles Hourcade & Emeric Fortin, 2000. "Impact economique des politiques climatiques : des controverses aux enjeux de coordination," Economie Internationale, CEPII research center, issue 82, pages 45-74.
    7. Olivier Barreteau, 2003. "The Joint Use of Role-Playing Games and Models Regarding Negotiation Processes: Characterization of Associations," Journal of Artificial Societies and Social Simulation, Journal of Artificial Societies and Social Simulation, vol. 6(2), pages 1-3.
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    JEL classification:

    • B12 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Classical (includes Adam Smith)
    • B31 - Schools of Economic Thought and Methodology - - History of Economic Thought: Individuals - - - Individuals
    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System


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