Why People Fear Banks and Why They Are Needed: Banks as Institutions of Caching and as Religious Symbols

Abstract

Banks are generally considered by most people to be utilities that allow for the transmission of value on a daily basis in modern society, but they also seem to create devastating events like credit crises by the manufacture of credit. How this power originated in human society is of interest. Most animals produce some degree of savings, either in caching from one season to the next or for later in one season. Often these savings are an inter-generational transfer for the initial survival of young as in some wasps, or in a later use by the same individual who produces the savings either in the same year or the next as in many birds. I have described many of these examples in an article that compares such caching to examples of human saving (Caldararo, 2009). The evolution of the bank, of institutions for organizing the savings of groups of humans has had a number of separate points of origin in history in various societies in antiquity and most recently during the Middle Ages in Europe. Why banks are seen as necessary and deserving of saving or protecting during economic crises often seems a matter of faith or dogma than of necessity.

Keywords: banking, history of banking, theory of banking, savings, credit, cross-cultural

JEL Classification: B25, D23, D60, D71, E41, E42, E44, E51, G21, H30, N20, P10, Z10