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Lessons from the American Experience with Free Banking

In: Unregulated Banking

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  • Hugh Rockoff

Abstract

Two decades ago the early history of American banking was dismissed as an object of study for someone concerned about current monetary problems, except perhaps as an object lesson about what can go wrong if the government does not apply a stern regulatory hand to the banking system. An article that appeared in Banker’s Magazine in 1971 entitled ‘The Early Ways and Crazy Days of Banking’ (Lasdon (1971)), accurately reflected contemporary thinking. Since that time, as recently noted by Milton Friedman and Anna J. Schwartz (1986), a number of factors have produced a renewal of interest in radical forms of banking regulation, and this period is now the object of intense research in academic circles.

Suggested Citation

  • Hugh Rockoff, 1991. "Lessons from the American Experience with Free Banking," Palgrave Macmillan Books, in: Forrest Capie & Geoffrey E. Wood (ed.), Unregulated Banking, chapter 3, pages 73-129, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-1-349-11398-9_3
    DOI: 10.1007/978-1-349-11398-9_3
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    References listed on IDEAS

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    1. Kahn, James A, 1985. "Another Look at Free Banking in the United States [New Evidence on the Free Banking Era]," American Economic Review, American Economic Association, vol. 75(4), pages 881-885, September.
    2. King, Robert G., 1983. "On the economics of private money," Journal of Monetary Economics, Elsevier, vol. 12(1), pages 127-158.
    3. Economopoulos, Andrew J, 1988. "Illinois Free Banking Experience," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 20(2), pages 249-264, May.
    4. Rolnick, Arthur J & Weber, Warren E, 1983. "New Evidence on the Free Banking Era," American Economic Review, American Economic Association, vol. 73(5), pages 1080-1091, December.
    5. Charles Goodhart, 1988. "The Evolution of Central Banks," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262570734, December.
    6. Rockoff, Hugh, 1974. "The Free Banking Era: A Reexamination," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 6(2), pages 141-167, May.
    7. Cowen, Tyler & Kroszner, Randall, 1987. "The Development of the New Monetary Economics," Journal of Political Economy, University of Chicago Press, vol. 95(3), pages 567-590, June.
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    Cited by:

    1. Herger, Nils, 2022. "Unregulated and regulated free banking: Evidence from the case of Switzerland (1826–1907)," Explorations in Economic History, Elsevier, vol. 83(C).
    2. Pablo Martín-Aceña & Elena Martínez Ruíz & Pilar Nogués Marco, 2012. "The Bank of Spain: a National Financial Insitution," Documentos de Trabajo (DT-AEHE) 1205, Asociación Española de Historia Económica.
    3. Gorton, Gary, 1999. "Pricing free bank notes," Journal of Monetary Economics, Elsevier, vol. 44(1), pages 33-64, August.
    4. Gary Gorton, 1993. "Reputation Formation in Early Bank Debt Markets," NBER Working Papers 4400, National Bureau of Economic Research, Inc.
    5. Stefano Ugolini, 2018. "The Historical Evolution of Central Banking," Post-Print hal-01887004, HAL.
    6. Mehmet Hasan Eken & Erkut Baloglu, 2017. "Crypto Currencies and their Destinies in the Future," International Journal of Finance & Banking Studies, Center for the Strategic Studies in Business and Finance, vol. 6(4), pages 01-11, April.
    7. Tobias Adrian & Adam B. Ashcraft & Nicola Cetorelli, 2013. "Shadow bank monitoring," Staff Reports 638, Federal Reserve Bank of New York.
    8. Michael D. Bordo, 2017. "Currency competition in Switzerland," Aussenwirtschaft, University of St. Gallen, School of Economics and Political Science, Swiss Institute for International Economics and Applied Economics Research, vol. 68(01), pages 101-108, December.

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