by Charles W. Calomiris, Stephen H. Haber
Princeton University Press
February 18, 2014
Why are banking systems unstable in so many countries but not in others? The United States has had twelve systemic banking crises since 1840 while Canada has had none. The banking systems of Mexico and Brazil have been crisis prone and have provided miniscule amounts of credit. Analyzing the political and banking history of the United Kingdom, the United States, Canada, Mexico, and Brazil through several centuries, Fragile by Design demonstrates that chronic banking crises and scarce credit are not accidents due to unforeseen circumstances but the result of complex political bargains. Charles Calomiris and Stephen Haber combine political history and economics to examine how coalitions of politicians, bankers, and other interest groups form, why some endure while others are undermined, and how they generate policies that determine who gets to be a banker, who has access to credit, and who pays for bank bailouts.

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