Fifteen years after the Global Financial Crisis: Recessions and Business Cycles in the History of Economic Thought

Stages of Banking Evolution in Perspective

Toporowski Jan, SOAS University of London

In her seminal paper on the stages of banking evolution, Victoria Chick argued that the shift from the 'Classical' view that saving determines investment to the Keynesian view that investment determines saving, is the result of an evolution of banking which offers a more flexible endogenous form of credit money. This paper argues that in fact the determination of saving by investment arises not so much the evolution of banking, but from the monetary nature of profits, which determines the evolution of the banking system, but also the development of the long-term capital market.


Keywords: Victoria Chick

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