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The Big Problem of Large Bills: The Bank of Amsterdam and the Origins of Central Banking

  • William Roberds


    (Research Department Federal Reserve Bank of Atlanta)

  • Stephen Quinn

This paper outlines a model of the first true central bank, the Bank of Amsterdam, founded in 1609. Employing a variant of the Freeman (1996) model of money and payments, we first analyze the problematic monetary situation in the Netherlands prior to the founding of the Bank. We then use the model to describe how the Bank could remedy this situation by creating a stable medium for the settlement of commercial obligations.

(This abstract was borrowed from another version of this item.)

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Paper provided by Society for Economic Dynamics in its series 2005 Meeting Papers with number 318.

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Date of creation: 2005
Date of revision:
Handle: RePEc:red:sed005:318
Contact details of provider: Postal: Society for Economic Dynamics Marina Azzimonti Department of Economics Stonybrook University 10 Nicolls Road Stonybrook NY 11790 USA
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  1. Arthur J. Rolnick & Francois R. Velde & Warren E. Weber, 1997. "The debasement puzzle: an essay on medieval monetary history," Quarterly Review, Federal Reserve Bank of Minneapolis, issue Fall, pages 8-20.
  2. Sussman, Nathan & Zeira, Joseph, 2003. "Commodity money inflation: theory and evidence from France in 1350-1436," Journal of Monetary Economics, Elsevier, vol. 50(8), pages 1769-1793, November.
  3. de Vries,Jan & van der Woude,Ad, 1997. "The First Modern Economy," Cambridge Books, Cambridge University Press, number 9780521578257, October.
  4. Freeman, Scott, 1996. "The Payments System, Liquidity, and Rediscounting," American Economic Review, American Economic Association, vol. 86(5), pages 1126-38, December.
  5. Ruilin Zhou, 2000. "Understanding intraday credit in large-value payment systems," Economic Perspectives, Federal Reserve Bank of Chicago, issue Q III, pages 29-44.
  6. Francois R. Velde & Warren E. Weber, 1998. "A model of bimetallism," Working Paper Series WP-98-8, Federal Reserve Bank of Chicago.
  7. Thomas J. Sargent & Neil Wallace, 1983. "A model of commodity money," Staff Report 85, Federal Reserve Bank of Minneapolis.
  8. Charles Goodhart, 1988. "The Evolution of Central Banks," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262570734, June.
  9. Fujiki, Hiroshi, 2003. "A model of the Federal Reserve Act under the international gold standard system," Journal of Monetary Economics, Elsevier, vol. 50(6), pages 1333-1350, September.
  10. de Vries,Jan & van der Woude,Ad, 1997. "The First Modern Economy," Cambridge Books, Cambridge University Press, number 9780521570619, October.
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