Today all countries have fiat money issued by a central bank. There is no obligation by a central bank to exchange its money for gold or any other good. Central banks have the monopoly to issue central bank money and have the power to create their money out of nothing. Creating such a monetary...

This paper evaluates the relationship between monetary and fiscal policy and the relative effectiveness of macroeconomic stabilization through the lens of Modern Money Theory (MMT). We articulate previously-neglected aspects of monetary sovereignty to offer a new interpretation of the Bernanke...

The Federal Reserve is commonly depicted as an institution set up by domestic actors to fulfill domestic functions that only later took on international and geopolitical dimensions. Yet we have long had an abundant literature on the financial projection of US power (“Dollar Diplomacy”) in...

Using newly collected discount rate data for six Swiss cities, we find no evidence of increasing integration during a 30-year period of lightly regulated free banking. We attribute this to two structural issues: banks had incentives to protect their local monopolies, and the inherent instability...

We present a financial history of the Seven Years' War (1756-1763) using a new dataset derived from the Bank of England minutes. We argue that the war and the associated actions of the Bank of England led to a transformation of the financial system. Additionally, while there was short-term...

Using newly collected discount rate data for six Swiss cities, we find no evidence of increasing integration during a 30-year period of lightly regulated free banking. We attribute this to two structural issues: banks had incentives to protect their local monopolies, and the inherent instability...

Debates about the nature and economic role of money are mostly informed by evidence from the 20th century, but money has existed for millennia. We argue that there are many lessons to be learned from monetary history that are relevant for current topics of policy relevance. The past acts as a...

This case study of the Illinois banking market shows how the private market managed the crisis in the banknote market during the first year of the Civil War. Banknotes backed by southern bonds started their decline with the election of Lincoln causing their values to fall below par. The Illinois...

We live in a rapidly aging world, in which people who are age 60 and older outnumber children under the age of five. This book reveals large and growing gaps in care for older adults in countries at all income levels and shows how to leverage reforms for improving health outcomes for older...

Does money naturally emerge from barter as our economic textbooks suggest, or is it a ``creature of the state"? Significant historical evidence supports the state theory. However, recent findings from excavations of the prehistoric town of Provadia indicate that salt, a good unique in its high...

"In 1690, the Massachusetts Bay Colony became the first government in the Western world to print paper money, the imagery for which initiated an indigenous American art form of remarkable dynamism and originality. After the Revolutionary War, disillusioned by how quickly its promiscuous printing...

Purpose The purpose is to market a reinterpretation of Brazilian economic history highlighting the importance of non-tradable goods to understand major historical developments such as the lack of industrialization in the mining boom; the rise and contribution of industries to development in the...

Robert Triffin (1911-1993) was one of the main protagonists in the international monetary debates in the postwar period. He became famous with his book Gold and the Dollar Crisis, published in 1960, in which he predicted the end of the Bretton Woods system. In his analysis there, Triffin was...

Robert Hoffert, in The Politics of Tension, describes the national narrative myth as “a homogenized” account of the events surrounding the calling of the Convention. Hoffert writes, “By starting their national story in 1787, American (historians) schooled themselves on a homogenized...

Central banks have been considering the introduction of central bank digital currencies (CBDCs). The theoretical literature indicates that this may influence private banks' lending activity and their profitability with implications for financial stability. To provide empirical evidence on this...

The notion of a nation-specific inflation trauma among the German population is ubiquitous in the public debate in Germany and beyond. Because of its experience with hyperinflation in 1923, the German population fears rising prices and favors stability-oriented monetary as well as fiscal policy....

This article provides an analysis of the economic cost incurred by the world through the use of the fiat international reserve currency since the end of the 1971 gold standard system. The article uses the Quantity Theory of Money to provide an empirical manifestation of how reserve currency...

The nature of money continues to perplex us. Over time anthropologists, economists, historians and sociologists have provided various answers to the question "what is money?" Ultimately these answers reflect different and often contradictory approaches to the dynamics of economic systems and...

In this paper we examine the role played by cash in crime. Our sources include research papers by economists (which point to a link between cash and corruption/shadow economy), works by crime scholars, and reports by international institutions and law enforcement agencies. Overall, opinions...

Central banks can operate with negative equity, and many have done so in history without undermining trust in fiat money. However, there are limits. How negative can central bank equity be before fiat money loses credibility? We address this question using a global games approach motivated by...

We consider the debut of a new monetary instrument, central bank digital currencies (CBDCs). Drawing on examples from monetary history, we argue that a successful monetary transformation must combine microeconomic efficiency with macroeconomic credibility. A paradoxical feature of these...

The origins of money and the foundations of state control -- Coinage, credit, and the financial revolution -- The revolutionary nature of money in British North America and the American Republic -- The revolutionary nature of money in Chinese, Islamic, and late colonial history -- The political...

The US derives enormous economic benefits from issuing the dominant global currency. This exorbitant privilege has been put at risk by the combination of the 2022 sanctions against Russia and new technological developments, specifically Central Bank Digital Currencies. CBDCs promise faster,...

Between 1900 and 1950, five of Canada’s domestic banks issued bank notes for circulation in the British West Indies. This article is about these Canadian banknotes. It starts with some background on the Canadian participation in the BWI bank sector and the circumstances that led to the...

As geopolitical tensions in Europe began to devolve into World War I, international investors began selling stocks and securities on the New York Stock Exchange (NYSE), converting the proceeds into gold. A massive outflow of gold from the United States would have likely sparked a banking panic....

This paper enumerates the adventures of the drachma step by step, dividing its story into seven parts. Specifically, its main purpose is to present some historical perspective on the behaviour of the monetary and fiscal policies pursued in Greece during the period from the early 1830s until the...

In the early 1870s, the global monetary system transitioned from bimetallism-a regime in which gold and silver currencies were tied at quasi-fixed exhange ratios-to the gold standard that was characterized by the use of (only) gold as the main currency metal by the largest and most advanced...

The return of inflation has revived some of the policy discussions that typically accompany inflationary episodes. Most of these discussions ignore the more fundamental question of why we operate in a world of unbacked, or fiat, money? This article, after providing a basic introductory model of...

We show that decentralized privately created money with unstable values can hinder the traded, more transaction-friction sensitive, sector of the economy. We do so in the context of the NationalBanking Act of 1864 in the United States that created a new federally-regulated, fully-backed currency...

The success of bitcoin as a medium of exchange poses a problem for the traditional Austrian view on the emergence of money. In particular, it casts doubt on the regression theorem of Ludwig von Mises, which implies that an item cannot gain acceptance as a medium of exchange without government...

This paper attempts to provide, for the first time, a survey of the construction of estimates of the quantity of money in Greece since the inception of the National Bank of Greece in 1842 until the eve of WWII. Specifically, we describe in detail the methods of construction and the sources of...

The South-Eastern European Monetary History Network (SEEMHN) is a community of financial historians, economists and statisticians, established in April 2006 at the initiation of the Bulgarian National Bank and the Bank of Greece. Its objective is to spread knowledge on the economic history of...

On February 24-25, 2006 an international workshop on “Regional and International Currency Arrangements” was held in Vienna. It was co-sponsored by the Oesterreichische Nationalbank and the Bank of Greece, and jointly organized by Eduard Hochreiter and George Tavlas. Academic economists and...

Fixed exchange rate regimes can be regarded as a “rule with escape clauses”, allowing the monetary authorities to temporarily suspend convertibility and enact a discretionary policy only under well-understood contingencies, such as wartime emergencies and financial panics. Seen from this...

In the early 1870s, the global monetary system transitioned from bimetallism—a regime in which gold and silver currencies were tied at quasi-fixed exhange ratios—to the gold standard that was characterized by the use of (only) gold as the main currency metal by the largest and most advanced...