This paper explores the possibility that banking panic frequency could have been reduced through the installation of a central bank during the US national banking era. A historical comparison between the UK banking system and the US banking system illuminates the essential nature of an institution adhering to Bagehotian principles. The fact that no banking panics occured after the creation of the Federal Reserve for a period of almost 20 years is perhaps the most convincing evidence supporting the view that the role of the lender-of-last resort must be provided by a government authority.
How to Cite:
Zhu, S., 2020. Would Banking Panics have been less Frequent in the US in 1863-1913 in the Presence of a Central Bank?. Knowles Review of Economic History, 1(1), pp.87–94.