The author argues that the idea, that the Bank of England accepted Walter Bagehot's recommendations from around the 1870s onwards and adopted the role of lender of last resort for the British financial markets, is a misconception. The published balance sheets give this impression, but a closer...

By setting bounds on money growth, the commodity standard is a solution to the monetary authority's time inconsistency problem, which arises from the fixed wage structure of the economy. If there is a supply shock to the backing commodity, the suspension of the commodity standard may be...