Currency Elasticity and Banking Panics: Theory and Evidence

Bruce Champ (), Bruce D. Smith and Stephen Williamson ()

Canadian Journal of Economics, 1996, vol. 29, issue 4, pages 828-64

Abstract: Existing models of banking panics contain no role for monetary factors and fail to explain why some banking systems experienced panics while others did not. A monetary model is constructed, where seasonal variations in the demand for liquidity and credit play a critical role in generating banking panics. These panics occur when there are restrictions on the issue of currency in private banks, but they do not occur if banks are unrestricted. Empirical evidence from Canada and the United States for the period 1880-1910 is largely consistent with the predictions of the model.

Date: 1996
View citations in EconPapers

Downloads: (external link)
http://links.jstor.org/sici?sici=0008-4085%2819961 ... EABPT%3E2.0.CO%3B2-P (text/html)
only available to JSTOR subscribers

Related works:
Working Paper: Currency Elasticity and Banking Panics: theory and Evidence (1991)
Working Paper: Currency Elasticity and Banking Panics: Theory and Evidence (1991)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:cje:issued:v:29:y:1996:i:4:p:828-64

Ordering information: This journal article can be ordered from
http://economics.ca/en/membership.php

Access Statistics for this article

Canadian Journal of Economics is edited by David Green

More articles in Canadian Journal of Economics from Canadian Economics Association
Address: Canadian Economics Association Prof. Steven Ambler, Secretary-Treasurer c/o Olivier Lebert, CEA/CJE/CPP Office C.P. 35006, 1221 Fleury Est Montréal, Québec, Canada H2C 3K4
Contact information at EDIRC.
Series data maintained by Prof. Werner Antweiler ().