David Hume on Banking and Hoarding

Maria Pia Paganelli

Southern Economic Journal, 2014, vol. 80, issue 4, 968-980

Abstract: David Hume opposes banks and favors hoarding. The only bank he reluctantly approves of is a public, 100% reserve bank. Other banks increase money supply and prices, hindering exports and economic growth. For Hume, a 100% reserve public bank would lead to “the destruction of paper‐credit” ([1752] 1985, p. 285), fostering economic growth instead by preventing inflation. Additionally, a 100% reserve bank hoards a large quantity of gold and silver, which is available in case of national emergency.

Date: 2014
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https://doi.org/10.4284/0038-4038-2013.163

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Persistent link: https://EconPapers.repec.org/RePEc:wly:soecon:v:80:y:2014:i:4:p:968-980

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