Competition and Currency: Essays on Free Banking and Money

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This collection of essays by distinguished economist Lawrence H. White provides persuasive justification for a competitive banking system. White sets out the case for free banking and argues that the proper regulator of the money supply is neither rules for nor discretion on the part of a central bank, but competition. He advocates the repeal of legislative barriers to competition and proposes solutions to the problems caused by government provision of money. Finally, he contends that the private provision of currency is an efficient way to promote monetization in less developed countries.

White addresses the question of the monetary standard and concludes that under a free banking system, the choice between fixed and floating exchange rates is nonexistent because it presupposes the monopolistic provision of money by national governments. He also explores the affinity between the gold standard and the competitive, private issue of currency.

White describes what laissez faire in monetary arrangements would mean and offers an insightful analysis of the theory of competitive monetary arrangements. He proposes a competitive involvement and which offers greater stability and flexibility than our current system. Competition and Currency is an important topical and theoretical work that deserves a wide audience.