Government Policy in the Mania and Crisis
Author: Gareth Campbell
Published in British Financial Crises since 1825 (2014), Oxford University Press.
Abstract: The response of the British government to the Railway Mania and subsequent Commercial Crisis can provide some insights into the challenges of legislating for stability. Parliament introduced several measures which could potentially have mitigated the extent of the difficulties, but these were generally ineffective. In some instances there was a conflict between stability and other goals, in other instances legislation had unintended consequences, whilst in most cases the focus was on small incremental changes which minimised opposition. The most effective policy was introduced in the midst of the crisis, when these considerations were less influential. Although this intervention may have increased moral hazard, by increasing expectations that similar policies would be pursued in future crises, the benefits almost certainly outweighed the costs.
Purchase Book:
http://www.amazon.co.uk/British-Financial-Crises-since-1825/dp/0199688664
Published in British Financial Crises since 1825 (2014), Oxford University Press.
Abstract: The response of the British government to the Railway Mania and subsequent Commercial Crisis can provide some insights into the challenges of legislating for stability. Parliament introduced several measures which could potentially have mitigated the extent of the difficulties, but these were generally ineffective. In some instances there was a conflict between stability and other goals, in other instances legislation had unintended consequences, whilst in most cases the focus was on small incremental changes which minimised opposition. The most effective policy was introduced in the midst of the crisis, when these considerations were less influential. Although this intervention may have increased moral hazard, by increasing expectations that similar policies would be pursued in future crises, the benefits almost certainly outweighed the costs.
Purchase Book:
http://www.amazon.co.uk/British-Financial-Crises-since-1825/dp/0199688664
