Money, Banking, and Old-School Historical Economics

39 Pages Posted: 14 Jun 2021

See all articles by Eric Monnet

Eric Monnet

Banque de France; Paris School of Economics (PSE)

Francois R. Velde

Federal Reserve Bank of Chicago

Date Written: November, 2020


We review developments in the history of money, banking, and financial intermediation over the last twenty years. We focus on studies of financial development, including the role of regulation and the history of central banking. We also review the literature of banking and financial crises. This area has been largely unaffected by the so-called new econometric methods that seek to prove causality in reduced form settings. We discuss why historical macroeconomics is less amenable to such methods, discuss the underlying concepts of causality, and emphasize that models remain the backbone of our historical narratives.

Keywords: historical macroeconomics, money, banking, financial intermediation

JEL Classification: N01, N10, N20

Suggested Citation

Monnet, Eric and Velde, Francois R., Money, Banking, and Old-School Historical Economics (November, 2020). FRB of Chicago Working Paper No. WP-2020-28, Available at SSRN: or

Eric Monnet (Contact Author)

Banque de France ( email )


Paris School of Economics (PSE) ( email )

48 Boulevard Jourdan
Paris, 75014 75014

Francois R. Velde

Federal Reserve Bank of Chicago ( email )

230 South LaSalle Street
Economic Research
Chicago, IL 60604-1413
United States
(312) 322-2526 (Phone)
(312) 322-2357 (Fax)

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