Unregulated and regulated free banking: Evidence from the case of Switzerland (1826-1907)

This Eviews file contains data, figures, and regression results on the free-banking history of Switzerland.<br> <br> The abstract for the corresponding paper, entitled " Unregulated and regulated free banking: Evidence from the case of Switzerland (1826-1907)" may be found below: <br> <br> This paper provides a reassessment of the free-banking history of Switzerland, which included both a period of unfettered competition (1826-1881) and one of strong banknote regulation (1881-1907). Unfettered competition between note-issuing banks gave rise to a fragmented paper-money system, with limited liquidity banknotes. To increase confidence in these notes, the federal government introduced a minimum-reserve requirement and a mutual-conversion rule in 1881. Based on a theoretical model and new empirical evidence, this paper shows that this enhanced regulation came at a cost, as it led to the overissuing of banknotes and an inelastic paper-money supply.