Front Page Titles (by Subject) Scotch and English Banking. - Money and the Mechanism of Exchange
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Scotch and English Banking. - William Stanley Jevons, Money and the Mechanism of Exchange 
Money and the Mechanism of Exchange (New York: D. Appleton and Co. 1876).
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Scotch and English Banking.
It is common, indeed, to point to the Scotch banks as a proof that a perfectly sound currency may be furnished by banks acting on their own unfettered discretion. Up to 1845, the twelve or thirteen Scotch banks certainly did possess the right of freely issuing notes down to one-pound notes, and only in one or two cases did bankruptcy occur. All this I grant, holding that Englishmen and Americans, and natives of all countries, may well admire the wonderful skill, sagacity, and caution with which Scotch bankers have developed and conducted their system. There is no doubt, too, that Scotch bankers are guiding the course of development of the banking system in England, India, the Australian colonies, and everywhere, with conspicuous success. If we were all Scotchmen, I believe the unlimited issue of one-pound notes would be an excellent measure. But when we compare the Scotch and English banking systems, we discover a profound difference. In Scotland there exist only eleven great banks, which take good care that there shall not be a twelfth great bank. The undoubted monopoly which they possess is, however, used with great moderation and wisdom, and by an immense ramification of branches (p. 258), every village has its banks, and every poor man may have his bank deposit, if he will save a few pounds. In England and Wales we have 267 private and 123 joint stock banks, or, in all, 388 banking firms, including in these numbers the London banks, but not including any of the numerous branch banks. There is, no doubt, a tendency to approximate to the Scotch system by the amalgamation of smaller banks. Still many new banks are from time to time started, and the competition between them is of the keenest character. The high dividends expected by the shareholders can only be earned by bold trading on small reserves, and every commercial man is aware that the money market is becoming more and more sensitive.