Abstract
This article analyses private credit operations in amsterdam in the seventeenth century to explain the absence of deposit banks. The financial system was highly segmented and a combination of declining business margins and narrow interest rate spreads cut the scope for deposit taking. Moreover, merchants had easy access to credit in the form of short-term loans which could be easily rolled over, or replaced at will. This technique worked well because a market developed providing key functions to control risk and price loans accordingly.
Original language | English |
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Pages (from-to) | 1178-1198 |
Journal | Economic History Review |
Volume | 69 |
Issue number | 4 |
DOIs | |
Publication status | Published - Nov 2016 |
Externally published | Yes |