The Speed of the Financial Revolution: Evidence from Hoare's Bank
50 Pages Posted: 13 Apr 2004
Date Written: March 2004
Abstract
Finance is important for development, yet the onset of modern economic growth in Britain lagged the British financial revolution by over a century. We present evidence from a new West-End London private bank to explain this delay. Hoare's Bank loaned primarily to a highly select and well-born clientele, although it did not discriminate against "unknown" borrowers in the early 18th century. It could not extend credit more generally because of government restrictions (usury limits) and policies (frequent wars). Britain's financial development could have aided growth substantially, had it not been for the rigidities and turmoil introduced by government interference.
Keywords: Financial Revolution, growth, finance, rationing, usury laws, institutional evelopment, eighteenth-century England
JEL Classification: E44, N23, N13, G21, G18, G28
Suggested Citation: Suggested Citation
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