Larry Neal, How it all began: the monetary and financial architecture of Europe during the first global capital markets, 1648–1815

The Treaty of Westphalia created the modern nation-state system of Europe and set the stage for the long-term success of financial capitalism. The new sovereign states experimented with competing monetary regimes during their wars over the next century and two-thirds while they extended and perfected the financial innovations in war finance developed during the Thirty Years War. The Dutch maintained fixed exchange rates, the French insisted on exercising monetary independence, while the English placed priority on free movement of international capital. In struggling with the trilemma of choosing among the goals of maintaining fixed exchange rates, monetary independence and free movement of capital, the governments of early modern Europe learned many valuable lessons. By the time of the Napoleonic wars, the innovations that emphasised reliance on financial markets rather than on financial institutions proved their superiority.

This article juxtaposes two bodies of oral evidence collected in 1877–78 and 1989–91 respectively to explore the dynamics of the London Stock Exchange as a physical market.The analysis highlights the long-run continuities in the pattern, organisation and culture of trading activity. In particular, it emphasises the necessity experienced by market makers (known as jobbers) to adapt to the demands of a highly visible trading environment. More broadly, further evidence is provided of the nature and diversity of trade relationships, economic exchange and price creation.

In 1865, France, Belgium, Italy and Switzerland signed a monetary convention(later known as the Latin Union), which provided for the intercirculationof specie between member states. Conventional analyses of the treaty (suchas that by Willis) have portrayed this arrangement as a by-product of Frenchpower politics. This article seeks to reinterpret the economic nature of theLatin Union, focusing on the interrelations between trade, finance and money.I argue that the Latin Union did not foster trade integration and that, asa matter of fact, such was not its objective, according to archival evidence.Instead, I suggest that the Latin Union was the result of the growth of Franceas a major supplier of capital. The need to provide French investors withexchange-rate guarantees led borrowing countries to tie their respective monetarysystems to that of France. This, in turn, created opportunities for internationalmonetary action and the French franc became the ‘natural’ focalpoint of projects of monetary unification. This evolution, however, had structurallimits which help to explain the downfall of the projects for expansion ofthe Latin Union.

Stefano Battilossi, Financial innovation and the golden ages of international banking: 1890–1931 and 1958–81

Throughout the twentieth century, the internationalisation of banking was both a factor for, and an ensuing aspect of, rising globalisation. During the period 1890–1931, commercial banks of industrialised countries promoted organisational and process innovations that successfully challenged the dominance of merchant banks in international financial intermediation. International banking re-emerged from interwar nationalistic retrenchment during the late 1950s, when banks exploited regulatory asymmetries to foster the emergence of Eurocurrency markets. Eurobanks provided not only global liquidity redistribution but also portfolio transformation services to corporate and sovereign customers. Financial innovations related to Eurobanking mark a secular discontinuity as they proved to be vehicles of a banking revolution, based on competition, deregulation and wholesale-market funding.

Lucy Newton, Trust and virtue in English banking: the assessment of borrowers by bank managements at the turn of the nineteenth century

Much has been made of the relationships between English banks and their customers. This article aims to examine the perceptions of banks' managements and their procedures in the assessment of English and Welsh borrowing customers at the turn of the century. During this period, as banks assumed the modern corporate form, their managements attempted to impose a more formalised structure for lending decisions – one that could be standardised and applied throughout an organisation. The article examines the impact of such changes upon lending decisions, together with the information utilised in making them. It focuses upon the use of ‘subjective’ information and criteria in order to shed light upon a transitional period in banking organisation. It also considers related issues such as customer reputation; the transition from personalised to transaction banking; and the respective roles of local branches and London head offices in decision-making.

Laura Stanciu, Italian multinational banking in interwareast central Europe

This article examines the interwar developmentof multinational investment undertaken by the most prominent Italian universalbank — Banca Commerciale Italiana — in Bulgaria, Hungary, Polandand Romania, referred to here as east central Europe. It analyses the extentto which considerations concerning universal banking's development are validin the case of Italian multinational investment in this region. The articleis neither a study of the 1930s financial crisis nor an analysis of the Italianuniversal banking per se. Instead, it questions the implicit relationshipbetween the fate of the activities of Banca Commerciale Italiana in east centralEurope and the general problems of the universal banking system during theearly 1930s. Evidence seems to suggest that the bank's withdrawal from theregion, beginning in the late 1920s, was more a result of managerial shortcomingsand unsound investment decisions than the crisis.

Simon Ville and Grant Fleming, Financial intermediaries and the design of loan contracts within the Australasian pastoral sector before the Second World War

This paper examines the pooling and separating contracts designed by Australasian financial intermediaries in the late nineteenth and early twentieth centuries. We show that, after an initial screening process, these agents altered interest rates and collateral requirements to separate out risk types to reveal additional information on borrowers. In multi-period contracts, agents opted for flexible contract structures which permitted changes in individual or community-wide circumstances.

Kathleen E. A. Monteith, Competition between BarclaysBank (DCO) and the Canadian banks in the West Indies, 1926–45

This article examines the extent to which collusion ruled out competitionin banking, and assesses the nature and impact of this competition in orderto ascertain the degree to which Barclays Bank (DCO) faced any significantchallenge to its position within the region. It is shown that the rigiditywhich is assumed to be characteristic of collusive agreements was not present,and that competition existed in the commercial banking market in the WestIndies during this period. It is also shown that non-price competition existedin many forms, and was capable of leading to a bank's position being usurpedby another.

This bibliographycovers publications that appeared during 1998. It follows previous criteria, being divided into twobroad areas: general literature on financial history in section I, and specialised material in section2. Section 2 is subdivided chronologically and, further, by geographical area (the completeclassification scheme was published in Volume I, Part 2, pp. 157–60). Where there are no entriesfor a particular section, the heading has been omitted. Abbreviations have been kept to a minimum butstandard abbreviations such as J. for Journal, Q. for Quarterly,Rev. for Review/Revue, have been used throughout. Short titles are used forreferences to edited volumes within the section in which they are listed, elsewhere they are cited infull. Articles published in books ‘edited by’ are mentioned only if the bibliographeraccessed the relevant index before the deadline for publication (August 1998). Doctoral theses andWorking Papers are not included.

The bibliographer is pleased to receive suggestions of any kindat his e-mail address: <noiret@iue.it>