From Partisan Banking to Open Access - A Study on the Emergence of Free Banking in Early Nineteenth Century Massachusetts

dc.contributor.advisorWallis, Johnen_US
dc.contributor.authorLu, Qianen_US
dc.contributor.departmentEconomicsen_US
dc.contributor.publisherDigital Repository at the University of Marylanden_US
dc.contributor.publisherUniversity of Maryland (College Park, Md.)en_US
dc.date.accessioned2014-10-11T05:52:19Z
dc.date.available2014-10-11T05:52:19Z
dc.date.issued2014en_US
dc.description.abstractMy dissertation examines how the financial sector, specifically banks, achieved open entry in early nineteenth-century Massachusetts. The first chapter introduces this question and provides the historical background and conceptual framework necessary for unpacking this question. The second chapter provides new evidence showing how the majority political party, the Federalists, held a monopoly on banks by dominating the state legislature in charge of issuing charters for new banks, effectively prohibiting members of the opposing political party, the Democratic- Republicans, from opening banks. Political turnover in the period between 1810 and 1812 destroyed the Federalist monopoly and allowed for the possibility of open entry in the banking sector. The third chapter provides a new measurement of an elite coalition by collecting original data about bank directors and state legislators in an effort to identify their relationship. The empirical results show how the political composition of the banking sector changed during the Federalist and the Democratic-Republican eras and how the banking sector became less connected to political elites (i.e. the legislators) in the 1830s-1850s. The fourth chapter shows that for people who were ever legislators at some point in their life, they were more likely to be legislators and bankers at the same time in the late 1790s and early 1800s than afterwards. The fifth chapter collects data on private accumulation of wealth from Boston tax rolls and data on bank balance sheets to show that bankers were always richer than other wealthy citizens in the 1830s and 1840s, but their relative wealth inequality remained stable. New banks chartered in the 1840s and 1850s were smaller banks. The sixth chapter provides an explanation of the transition from limited to open access banking based on the idea of intra-elite competition. Taken together, these chapters show that the banking sector moved toward free banking by solving the problem of exclusive party politics. Although intra-elite conflicts did not eliminate elites banking privileges, political elites and banks were still connected and bankers remained the wealthy class, they nevertheless led to de facto free banking.en_US
dc.identifierhttps://doi.org/10.13016/M2W89W
dc.identifier.urihttp://hdl.handle.net/1903/15788
dc.language.isoenen_US
dc.subject.pqcontrolledEconomic historyen_US
dc.subject.pqcontrolledBankingen_US
dc.subject.pquncontrolledFree Bankingen_US
dc.subject.pquncontrolledGovernmenten_US
dc.subject.pquncontrolledOpen Accessen_US
dc.subject.pquncontrolledPartisan Bankingen_US
dc.subject.pquncontrolledRegulationen_US
dc.titleFrom Partisan Banking to Open Access - A Study on the Emergence of Free Banking in Early Nineteenth Century Massachusettsen_US
dc.typeDissertationen_US

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