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Liquidity and Borrowing from a Lender of Last Resort during the Crisis of 1884

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  • Christopher Hoag

Abstract

This paper investigates the relation between bank liquidity and borrowing from a lender of last resort on a high frequency basis during a financial crisis. The paper evaluates weekly observations of individual bank borrowing of clearinghouse loan certificates by a panel of New York Clearing House member banks during the crisis of 1884. Naturally, banks with higher reserve ratios borrowed lower amounts, but banks replaced a dollar of reserves with less than a dollar of borrowing from a lender of last resort.

Suggested Citation

  • Christopher Hoag, 2023. "Liquidity and Borrowing from a Lender of Last Resort during the Crisis of 1884," International Journal of Finance & Banking Studies, Center for the Strategic Studies in Business and Finance, vol. 12(4), pages 01-13, January.
    • Handle: RePEc:rbs:ijfbss:v:12:y:2023:i:4:id:2779
    DOI: 10.20525/ijfbs.v12i4.2779
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    References listed on IDEAS

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