Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/70394 
Authors: 
Year of Publication: 
2002
Series/Report no.: 
Research Report No. 2002-9
Publisher: 
The University of Western Ontario, Department of Economics, London (Ontario)
Abstract: 
Henry Thornton and Walter Bagehot were both advocates of discretionary monetary policy, especially as regards the Bank of England's role as a lender of last resort, but they differed on many details of the case. Where Bagehot thought that the Bank's central position in the financial system was purely the product of a specific monopoly privileges, Thornton also saw it as the desirable and natural outcome of the operations of banking; where Bagehot located the productivity of banking in credit markets, Thornton stressed the importance of liability side of the system's balance sheet; and where Bagehot took the desirability of gold convertibility for granted, Thornton was willing to trade off this goal against the maintenance of monetary stability.
Document Type: 
Working Paper

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