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Not an ordinary bank but a great engine of state: the Bank of England and the British economy, 1694–1844

O'Brien, Patrick K. and Palma, Nuno (2022) Not an ordinary bank but a great engine of state: the Bank of England and the British economy, 1694–1844. Economic History Review. ISSN 0013-0117

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Identification Number: 10.1111/ehr.13191

Abstract

From its foundation as a private corporation in 1694, the Bank of England extended large amounts of credit to support the British private economy and to support an increasingly centralised British state. The Bank helped the British state reach a position of geopolitical and economic hegemony in the international economic order. In this paper, we deploy recalibrated financial data to analyse an evolving trajectory of connections between the British economy, the state, and the Bank of England. We show how these connections contributed to form an effective and efficient fiscal–naval state and promote the development of a system of financial intermediation for the economy. This symbiotic relationship became stronger after 1793. The evidence that we consider here shows that although the Bank was nominally a private institution and profits were paid to its shareholders, it was playing a public role well before Bagehot's doctrine.

Item Type: Article
Official URL: https://onlinelibrary.wiley.com/journal/14680289
Additional Information: © 2022 The Author(s).
Divisions: LSE
Economic History
Subjects: H Social Sciences > HC Economic History and Conditions
JEL classification: H - Public Economics > H4 - Publicly Provided Goods > H41 - Public Goods
N - Economic History > N1 - Macroeconomics and Monetary Economics; Growth and Fluctuations > N13 - Europe: Pre-1913
N - Economic History > N2 - Financial Markets and Institutions > N23 - Europe: Pre-1913
N - Economic History > N4 - Government, War, Law, and Regulation > N43 - Europe: Pre-1913
Date Deposited: 30 Sep 2022 16:33
Last Modified: 17 Oct 2022 11:03
URI: http://eprints.lse.ac.uk/id/eprint/116868

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