Editing Central bank (section)

===National central banks since 1800===
[[File:BankofFinlandSuomenPankkiFinlandsBank.jpg|thumb|The [[Bank of Finland]] in [[Helsinki]]]]
[[File:Marriner S. Eccles Federal Reserve Board Building.jpg|thumb |The [[Eccles Building]] in [[Washington, D.C.]] houses the main offices of the [[Board of Governors of the Federal Reserve]].]]
[[File:People's Bank of China.jpg|thumb|Head office of the [[People's Bank of China]] in [[Beijing]]]]

Central banks were established in many European countries during the 19th century.<ref>{{cite book|author=Clifford Gomez|title=Banking and Finance: Theory, Law and Practice|url=https://books.google.com/books?id=_4Nkye6tpWcC&pg=PA100|year=2011|publisher=PHI|page=100|isbn=9788120342378|access-date=29 September 2018|archive-date=1 July 2023|archive-url=https://web.archive.org/web/20230701075943/https://books.google.com/books?id=_4Nkye6tpWcC&pg=PA100|url-status=live}}</ref><ref>{{cite book|author1=Michael D. Bordo|author2=Marc Flandreau|author3=Jan F. Qvigstad|title=Central Banks at a Crossroads: What Can We Learn from History?|url=https://books.google.com/books?id=cZ0rDAAAQBAJ&pg=PA2|year=2016|publisher=Cambridge UP|pages=1–17|isbn=9781107149663|access-date=29 September 2018|archive-date=1 July 2023|archive-url=https://web.archive.org/web/20230701075943/https://books.google.com/books?id=cZ0rDAAAQBAJ&pg=PA2|url-status=live}}</ref> Napoleon created the [[Banque de France]] in 1800, in order to stabilize and develop the French economy and to improve the financing of his wars.<ref>{{cite book|author=Michael Stephen Smith|title=The Emergence of Modern Business Enterprise in France, 1800–1930|url=https://books.google.com/books?id=zs26hd5keYkC&pg=PA59|year=2006|publisher=Harvard UP|page=59|isbn=9780674019393|access-date=29 September 2018|archive-date=1 July 2023|archive-url=https://web.archive.org/web/20230701080153/https://books.google.com/books?id=zs26hd5keYkC&pg=PA59|url-status=live}}</ref> The Bank of France remained the most important Continental European central bank throughout the 19th century.<ref>{{Cite web |date=2023-07-30 |title=Exploring the Currency of 19th Century France: A Glimpse into the Economic Landscape – 19th Century |url=https://19thcentury.us/19th-century-french-currency/ |access-date=2023-11-02 |website=19thcentury.us |language=en-US}}</ref> The [[Bank of Finland]] was founded in 1812, soon after Finland had been taken over from Sweden by Russia to become a [[Grand Duchy of Finland|grand duchy]].<ref>{{cite web|url=http://www.suomenpankki.fi/en/suomen_pankki/tehtavat/Pages/history.aspx?hl=history|title=History|publisher=Bank of Finland|access-date=28 October 2014|url-status=dead|archive-url=https://web.archive.org/web/20141028111153/http://www.suomenpankki.fi/en/suomen_pankki/tehtavat/Pages/history.aspx?hl=history|archive-date=28 October 2014}}</ref> Simultaneously, a quasi-central banking role was played by a small group of powerful family-run banking networks, typified by the [[Rothschild family|House of Rothschild]], with branches in major cities across Europe, as well as [[Hottinguer family|Hottinguer]] in Switzerland and [[Oppenheim family|Oppenheim]] in Germany.<ref>Niall Ferguson, ''The House of Rothschild: Volume 1: Money's Prophets: 1798–1848'' (1999).</ref><ref>Gabriele Teichmann, "Sal. Oppenheim jr. & Cie., Cologne." ''Financial History Review'' 1.1 (1994): 69–78, [https://www.cambridge.org/core/journals/financial-history-review/article/sal-oppenheim-jr-cie-cologne/2F1E283B5C787E2FC508A7F1ABA24A34 online in English] {{Webarchive|url=https://web.archive.org/web/20180929194901/https://www.cambridge.org/core/journals/financial-history-review/article/sal-oppenheim-jr-cie-cologne/2F1E283B5C787E2FC508A7F1ABA24A34 |date=29 September 2018 }}.</ref>

The theory of central banking, even though the name was not yet widely used, evolved in the 19th century. [[Henry Thornton (reformer)|Henry Thornton]], an opponent of the [[real bills doctrine]], was a defender of the bullionist position and a significant figure in monetary theory. Thornton's process of monetary expansion anticipated the theories of [[Knut Wicksell]] regarding the "cumulative process which restates the Quantity Theory in a theoretically coherent form". As a response to a currency crisis in 1797, Thornton wrote in 1802 ''[[An Enquiry into the Nature and Effects of the Paper Credit of Great Britain]]'', in which he argued that the increase in paper credit did not cause the crisis. The book also gives a detailed account of the British monetary system as well as a detailed examination of the ways in which the Bank of England should act to counteract fluctuations in the value of the pound.<ref>Philippe Beaugrand, ''Henry Thornton, un précurseur de J.M. Keynes'', Paris: Presses Universitaires de France, 1981.</ref>

In the United Kingdom until the mid-nineteenth century, commercial banks were able to issue their own banknotes, and notes issued by provincial banking companies were commonly in circulation.<ref>{{cite web|title=£2 note issued by Evans, Jones, Davies & Co.|url=https://www.britishmuseum.org/explore/highlights/highlight_objects/cm/others/%c2%a32_note_issued_by_evans,_jones.aspx|publisher=British Museum|access-date=31 October 2011|archive-url=https://web.archive.org/web/20120118104053/http://www.britishmuseum.org/explore/highlights/highlight_objects/cm/others/%c2%a32_note_issued_by_evans,_jones.aspx|archive-date=18 January 2012|url-status=dead}}</ref> Many consider the origins of the central bank to lie with the passage of the [[Bank Charter Act 1844]].<ref name="lse" /> Under the 1844 Act, [[bullionism]] was institutionalized in Britain,<ref>Anna Gambles, ''Protection and Politics: Conservative Economic Discourse, 1815–1852'' (Royal Historical Society/Boydell Press, 1999), pp. 117–18.</ref> creating a ratio between the gold reserves held by the [[Bank of England]] and the notes that the bank could issue.<ref name="Poovey">[[Mary Poovey]], ''Genres of the Credit Economy: Mediating Value in Eighteenth- and Nineteenth-Century Britain'' (University of Chicago Press, 2008), p. 49.</ref> The Act also placed strict curbs on the issuance of notes by the country banks.<ref name="Poovey" /> The Bank of England took over a role of lender of last resort in the 1870s after criticism of its lacklustre response to the failure of [[Overend, Gurney and Company]]. The journalist [[Walter Bagehot]] wrote on the subject in ''[[Lombard Street: A Description of the Money Market]]'', in which he advocated for the bank to officially become a [[lender of last resort]] during a [[credit crunch]], sometimes referred to as "Bagehot's dictum".

The 19th and early 20th centuries central banks in most of Europe and [[Bank of Japan|Japan]] developed under the international [[gold standard]]. [[Free banking]] or [[currency board]]s were common at the time.{{citation needed|date=July 2023}} Problems with collapses of banks during downturns, however, led to wider support for central banks in those nations which did not as yet possess them, for example in Australia.{{citation needed|date=July 2023}} In the United States, the role of a central bank had been ended in the so-called [[Bank War]] of the 1830s by President [[Andrew Jackson]].<ref>Bray Hammond, "Jackson's Fight with the 'Money Power{{'"}}. ''American Heritage'' (June 1956) 7#4: 9–11, 100–103.</ref> In 1913, the U.S. created the [[Federal Reserve System]] through the passing of [[The Federal Reserve Act]].<ref>Miklos Sebok, "President Wilson and the International Origins of the Federal Reserve System – A Reappraisal." ''White House Studies'' 10.4 (2011): 424–447.</ref>

Following [[World War I]], the [[Economic and Financial Organization of the League of Nations|Economic and Financial Organization]] (EFO) of the [[League of Nations]], influenced by the ideas of [[Montagu Norman]] and other leading policymakers and economists of the time, took an active role to promote the independence of central banks, a key component of the economic orthodoxy the EFO fostered at the [[Brussels Conference (1920)]]. The EFO thus directed the creation of the [[Oesterreichische Nationalbank]] in [[Austria]], [[Hungarian National Bank]], [[Bank of Danzig]], and [[Bank of Greece]], as well as comprehensive reforms of the [[Bulgarian National Bank]] and [[Bank of Estonia]]. Similar ideas were emulated in other newly independent European countries, e.g. for the [[National Bank of Czechoslovakia]].<ref name=DeCecco>{{cite web |title=Central Banking in Central and Eastern Europe: Lessons From the Interwar Years' Experience |author=Marcello De Cecco |year=1994 |publisher=International Monetary Fund |url=https://www.elibrary.imf.org/view/journals/001/1994/127/article-A001-en.xml |location=Washington DC}}</ref>

[[Brazil]] established a central bank in 1945, which was a precursor to the [[Central Bank of Brazil]] created twenty years later. After gaining independence, numerous African and Asian countries also established central banks or monetary unions. The [[Reserve Bank of India]], which had been established during British colonial rule as a private company, was nationalized in 1949 following India's independence. By the early 21st century, most of the world's countries had a national central bank set up as a [[public sector]] institution, albeit with widely varying degrees of independence.