Skip to Main Content
Have library access? Log in through your library
The Regulation and Reform of the American Banking System, 1900-1929

The Regulation and Reform of the American Banking System, 1900-1929

Copyright Date: 1983
Pages: 268
  • Cite this Item
  • Book Info
    The Regulation and Reform of the American Banking System, 1900-1929
    Book Description:

    Examining the regulation of banking in the United States between 1900 and the Great Depression, Eugene Nelson White shows how Congress and the state legislatures tried to strengthen the banking system by creating new institutions, rather than by changing nineteenth-century laws that perpetuated the unit structure of the banking industry.

    Originally published in 1983.

    ThePrinceton Legacy Libraryuses the latest print-on-demand technology to again make available previously out-of-print books from the distinguished backlist of Princeton University Press. These paperback editions preserve the original texts of these important books while presenting them in durable paperback editions. The goal of the Princeton Legacy Library is to vastly increase access to the rich scholarly heritage found in the thousands of books published by Princeton University Press since its founding in 1905.

    eISBN: 978-1-4008-5744-9
    Subjects: Finance

Table of Contents

  1. Front Matter
    (pp. i-vi)
  2. Table of Contents
    (pp. vii-x)
  3. List of Tables
    (pp. xi-xii)
  4. Preface
    (pp. xiii-2)
    E. N. W.
  5. Introduction
    (pp. 3-9)

    Banking has been one of the most regulated industries in the United States. Much of the legislation governing banking has been generated by the struggle between the federal and state governments for control of the banking system. In spite of many changes, the distinctive “dual banking system” that emerged from this competitive regulation is still an important feature of American banking today. This book focuses on the years 1900–1929 when both the state and the federal governments had begun to reform their banking laws.

    The difficulties the reformers had in providing adequate answers to the problems of the banking...

  6. 1 The Dual Banking System before 1914
    (pp. 10-62)

    The most salient and enduring feature of the American banking system since the Civil War has been the rivalry between the federal and state regulatory authorities over the establishment and control of banks. The origins of the Federal Reserve System’s membership problem may be traced to the difficulties its predecessor, the National Banking System, experienced in maintaining its membership vis-à-vis the state banking systems. The National Banking System was created by Congress with the purpose of establishing a uniform currency issued by banks chartered and regulated by the Comptroller of the Currency. Although the nation was provided with a uniform...

  7. 2 Federal Banking Reform and the Evolution of the Federal Reserve System
    (pp. 63-125)

    Before the panic of 1907, banking reform was primarily the concern of big-city bankers and federal officials, but that financial crisis, which traumatized the nation, made reform a political imperative. Legislative proposals in Congress to restructure the banking system awakened the interest of the entire banking community. The conflicts already apparent between national banks and state-regulated institutions were heightened, and the tensions between country, reserve-city, and New York banks grew as each feared that the others would secure more favorable legislation. The Federal Reserve Act of 1913 reflected an attempt to accommodate the diverse banking interests and secure their support...

  8. 3 The Dual Banking System in the Early Years of the Federal Reserve System, 1914–1929
    (pp. 126-187)

    The decline in the membership of the National Banking System after 1900 deeply concerned banking reformers, and it served to direct their efforts to change the banking system. By passing the Federal Reserve Act, Congress hoped to strengthen the system, but no attempt was made to reshape it completely. The dominance of unit banking was not challenged, and the Federal Reserve System was grafted on to the National Banking System. The founders of the Federal Reserve earnestly desired all banks to enter the new system; but, while they required all national banks to join, state-bank membership remained voluntary. This was...

  9. 4 State Banking Reforms: Deposit Insurance as a Solution to the Problems of the Banking System
    (pp. 188-222)

    Congress and the state legislatures responded to the panic of 1907 with legislation aimed at strengthening the nation’s banking system. Most studies of banking reform focus solely on the events at the federal level that led to the creation of the Federal Reserve System, conveying the impression that there was little activity at the state level.¹ The state legislatures did not, however, stand by idly, waiting for the federal government to act. The response of several states to the panic was to propose the establishment of state-sponsored deposit guarantee funds. This began a spirited debate that defined sharply the points...

  10. Conclusion
    (pp. 223-228)

    The federal and state legislation adopted in the second half of the nineteenth century to regulate banking led to the development of an industry composed of thousands of independent banks. The federal ban on branching by national banks and the almost complete prohibition of branching by the states ensured the preeminence of the single-office bank. In the first years of the twentieth century, the increasing population density in urban areas allowed some banks to grow to a substantial size, but the distinguishing feature of the banking system was the large and growing number of very small unit banks. These small...

  11. Appendix A: Data for Probit Analysis
    (pp. 229-234)
  12. Appendix B: Probit Analysis
    (pp. 235-240)
  13. Bibliography
    (pp. 241-246)
  14. Index
    (pp. 247-252)
  15. Back Matter
    (pp. 253-253)