Communist countries in Europe developed large planning bureaucracies and the infrastructure needed to confirm and force compliance with plans. Yet, bureaucracies are not entirely fungible. These systems proved unnecessary in the new capitalist economy. However, a capitalist economy does require one bureaucracy that is not needed, at least not in anything like its usual…
While not uncontested by other Italian city-states, Venice was a candidate for the foremost financial center of Europe in the 15th century. It was not home to many financial institutions but the ones it did possess were among the largest in Europe. These were banks tied to big merchant families, often noble families. Yet,…
Various Italian city-states excelled in banking as it existed in 15th century Europe. In or around this period, Siena, Florence, Venice, and Genoa each were home to some of the largest European financial institutions of their day. Some lasted for over a century, others for only a small fraction of that time. Though the…
France was the setting of one of the largest early experiments with paper money in Europe. This experiment usually refers to the paper money introduced in France by the Scottish economist and banker John Law in the mid-to-late 1710s. This was not the true introduction of paper money in France though. The country used…
The early diplomatic history of the United States, before the War of Independence even came to a close, revolved around securing recognition from other countries and raising money from their governments, bankers, or investors. Of course, London’s financial markets were off limits until the peace treaty of 1783 and France, while the provider of…
Commodity exports were the mainstays of peripheral economies in the 19th century. Agricultural products were among these. Initially, these were inputs into industrial processes, often in the textile industry: think of Indian dyes, American cotton, and New Zealand wool. Near the end of the 19th century, consumer demand enlarged markets for other ‘soft’ agricultural…
Standards of living improved in all Western countries after the Second World War. Incomes rose quickly, allowing more people to enjoy the use of products that were novelties or luxuries before the war, things like household appliances and cars. Homes were getting larger to fit all of the things people were able to afford…
As communist countries transitioned to capitalism, numerous existing institutions lost their relevance and countries found themselves short of the institutions crucial to developing successful capitalist economies. One of these were banking institutions. Banks are important to raising and intermediating the money required by new and existing industries alike. Poland had some banks before 1989…
For decades before the First World War, the values of currencies were broadly stable. Fixed exchange rates against gold and convincing commitments by governments to maintaining the gold standard made this so. The war caused almost all countries to suspend their gold standards and many governments printed far more money and borrowed a lot…
Just before the ‘second industrial revolution’ created new industries and their accompanying fortunes in areas like electricity, steel, oil, and telephones, new investment in the United States was concentrated in railways. Railroad projects attracted huge amounts of private and public resources. It also attracted speculators and their machinations as well as the unscrupulous business…
