The Currency School and the Banking School – Who Got it Right?
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The Currency and Banking School dispute is usually regarded by historians of economic thought as representative of divergent views on the nature and role of money and banking within society. However, there is more to be said of the dispute that is of interest. Because contextual disparities, and methodological and motivational issues remain largely neglected in the discussion, many important similarities and differences between the two schools are usually glossed over, whilst the broader cultural context of a transformation in the discipline of political economy itself is generally ignored. By exploring this wider context a more nuanced appreciation of the two sides in the dispute can be achieved, although with such a revisionist approach the luxury of simplistic notions of ‘right’ and ‘wrong’ is necessarily relinquished, and the similarities between the two schools become more salient.