The Decentralised Central Bank: Regional Bank Rate Autonomy in Norway, 1850-1892

31 Pages Posted: 13 Jan 2016

See all articles by Jan Tore Klovland

Jan Tore Klovland

Norwegian School of Economics (NHH) - Department of Economics

Lars Fredrik Øksendal

Norwegian School of Economics (NHH) - Department of Economics

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Date Written: December 23, 2015

Abstract

Before 1893 the regional branches of Norges Bank set their own bank rates. We discuss how bank rate autonomy could be reconciled with the fixed exchange rate commitments of the silver and gold standard. Although the headquarters of the bank was in Trondhjem, we find that the Christiania branch played the key role in providing leadership in bank rate policy. Foreign interest rate impulses were important for bank rate decisions, but there was also some leeway for responding to idiosyncratic shocks facing the Norwegian economy.

Keywords: bank rate, gold standard, monetary policy

JEL Classification: E58, N23

Suggested Citation

Klovland, Jan T. and Øksendal, Lars Fredrik, The Decentralised Central Bank: Regional Bank Rate Autonomy in Norway, 1850-1892 (December 23, 2015). Norges Bank Working Paper 20/2015, Available at SSRN: https://ssrn.com/abstract=2714381

Jan T. Klovland (Contact Author)

Norwegian School of Economics (NHH) - Department of Economics ( email )

Helleveien 30
N-5035 Bergen
Norway

Lars Fredrik Øksendal

Norwegian School of Economics (NHH) - Department of Economics ( email )

Helleveien 30
N-5035 Bergen
Norway

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