Private Money and Money Market Integration: The Role of Payments Infrastructure in 19th Century Switzerland

Rebecca Stuart and Daniel Kaufmann

No 21151, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: Using newly collected discount rate data for six Swiss cities from 1846 to 1893, 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 ward off competitors by protecting their local monopolies or forming cartels, and there was always a risk (which varied across banks) that banknotes were not accepted or converted at par. We use a novel counterfactual to show that these issues increased discount rate dispersion, and argue that as a result, public regulation of payments infrastructure was necessary for money market integration.

Keywords: Switzerland; 19th century (search for similar items in EconPapers)
JEL-codes: E43 E44 F33 F45 N13 N23 (search for similar items in EconPapers)
Date: 2026-02
References: Add references at CitEc
Citations:

Downloads: (external link)
https://cepr.org/publications/DP21151 (application/pdf)

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:cpr:ceprdp:21151

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP21151

Access Statistics for this paper

More papers in CEPR Discussion Papers from Centre for Economic Policy Research 33 Great Sutton Street, London EC1V 0DX, UK.
Bibliographic data for series maintained by CEPR ().