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Between the ’Bank Screw’ and ’affording assistance’: Rules, standards and the Bank Charter Act of 1844

Frame, Iain (2019) Between the ’Bank Screw’ and ’affording assistance’: Rules, standards and the Bank Charter Act of 1844. Modern Law Review, 83 (1). pp. 64-90. ISSN 0026-7961. E-ISSN 1468-2230. (doi:10.1111/1468-2230.12467) (KAR id:75119)

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Abstract

This article explores a dilemma at the centre of the monetary order: how to counter inflation eroding the value of money and simultaneously allow bank‐created credit to meet the needs of an expanding economy. Building on recent scholarship on the history of money, the article analyses the Bank Charter Act of 1844 and the financial crisis of 1847 to reveal a response to this dilemma which continues to shape the modern context. That response relies on ex ante restrictive measures in a bid to limit the discretion of the monetary authorities and cultivate financially prudent behaviour. Yet the history of the mid‐nineteenth century exposes the challenges faced by those who enforce such rules, challenges which tie the mid‐nineteenth century to the post 2008 reforms in both the US and the Eurozone, and reveal the ongoing force of the dilemma: that simultaneous desire for both expansive credit and sound money.

Item Type: Article
DOI/Identification number: 10.1111/1468-2230.12467
Uncontrolled keywords: inflation, bank-created credit, Bank Charter Act 1844
Subjects: K Law
Divisions: Divisions > Division for the Study of Law, Society and Social Justice > Kent Law School
Depositing User: Sian Robertson
Date Deposited: 28 Jun 2019 14:26 UTC
Last Modified: 16 Feb 2021 14:05 UTC
Resource URI: https://kar.kent.ac.uk/id/eprint/75119 (The current URI for this page, for reference purposes)
Frame, Iain: https://orcid.org/0000-0003-3288-8086
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