The rapid growth of deposits in New York City over the three decades following the Civil War is often attributed to the release of pent-up demand for the services that transactions accounts could provide. I advance a complementary explanation that centers on the existence of an increasingly...

In this essay I propose that the adoption of the U.S. dollar as a common currency shortly after the ratification of the Federal Constitution and the accompanying transition from a fiat to specie standard was a pivotal moment in the nation's early history and marked an improvement over the...

Among the thirteen original colonies, Pennsylvania was most successful at issuing paper money with only minimal effects on prices -- so much so that the colony's experience is sometimes seen as violating the classical quantity theory of money. Quantity theorists usually attribute this apparent...

This paper uses standard tools of empirical macro economics to examine how well the existing historical time series support a role for financial factors in real sector activity in four economies that experienced what are widely considered to be 'financial revolutions' over the past 400 years....

The Panic of 1837 stands among the most severe banking crises in U.S. history, marking the start of a business downturn from which the nation would not recover for six years. Given the serious consequences of the panic for the rapidly evolving commercial and industrial sectors, it is thus not...

The rapid growth of equity markets in emerging economies over the past decade has prompted economists to raise important questions about their macroeconomic impact. Although the relative brevity of this expansion has made it challenging to perform such an evaluation, there remains a strong...

Electricity and Information Technology (IT) are perhaps the two most important general purpose technologies (GPTs) to date. We analyze how the U.S. economy reacted to them. The Electricity and IT eras are similar, but also differ in several important ways. Electrification was more broadly...

We study the relation between IPO investment and the rate of interest. We model the IPO timing decision and show that the implied relation between interest rates and investment is non-monotonic, and the data support the implication. At low rates of interest firms delay their IPOs. This happens...

U.S. Bank deposits by individuals grew from 4% of GDP at the time of the National Banking Acts in 1863-64 to 23% by the time of the Federal Reserve's founding. A comprehensive collection of bank- level data shows that most gains occurred immediately after the Acts, Specie Resumption in 1879, and...

Studies have shown a connection between finance and growth, but most do not consider how financial and real factors interact to put a virtuous cycle of economic development into motion. As the main transportation advance of the 19th century, railroads connected established commercial centers and...