The Characteristics and Effects of a Free Market in Money and Banking

Brian P. Simpson

Chapter 5 in Money, Banking, and the Business Cycle, 2014, pp 151-185 from Palgrave Macmillan

Abstract: Abstract This chapter shows that a free monetary and banking system means absolutely no government interference in money and banking. It discusses what is meant by “no government interference.” Such a system is unprecedented in history, except for possibly the very first banks in ancient Greece or fourteenth-century Italy. From the very beginning, or very shortly thereafter, governments interfered in monetary and banking systems to gain advantage for themselves and those they wanted to favor. This interference existed in the form of minting coins, debasing the currency, allowing banks to suspend payment when payment was contractually required on demand, raiding bank vaults, and so on. A free market in money and banking will lead to a level of stability in the economy that will make the economic system seem boring compared to today, since it will virtually eliminate monetary induced financial crises, recessions, and depressions. Developments in the economy will still be exciting; however, the excitement will be confined to rapid rates of economic progress; innovations in products and methods of production; the development of new technologies; the exploration of space and the colonization of moons, planets and other solar systems by private individuals; and a rapidly rising standard of living.

Keywords: Banking System; Free Market; Money Supply; Deposit Insurance; Private Bank (search for similar items in EconPapers)
Date: 2014
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
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: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-33656-9_6

Ordering information: This item can be ordered from
http://www.palgrave.com/9781137336569

DOI: 10.1057/9781137336569_6

Access Statistics for this chapter

More chapters in Palgrave Macmillan Books from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().