ABSTRACT
The emphasis in this essay is on the practical business of learning lessons in an ever-changing institutional environment. But it should be remembered that the learning process took place against a background of wider intellectual debate, some of which involved the development of economic theory centring on the nature of money and the role of banking in the economy. Some of the debate was more political or philosophical, concerned with the relative merits of laissez-faire as compared with a role for the state. In many ways the debate on money and banking is intimately bound up with that on free trade. In money and banking it took place in a context of rules versus discretion over monetary policy, with the slightly paradoxical outcome that rules were thought to be more necessary when the dominant policy was one of laissez-faire.
