ABSTRACT
Some time ago, monetary economists were inclined to ask whether central banks were universally necessary. Today, they would probably agree that, once a country effectively becomes part of the modern world, some form of monetary regulation is desirable. The establishment of a central bank is perhaps the most obvious way of ensuring that such regulation will be implemented with some semblance of expertise and—one hopes—in as objective a manner as is consistent with the maintenance of relatively harmonious relationships with the country’s fiscal authorities. Admittedly, there are times when, because of the relative poverty or small size of a country, a central bank may seem to be rather an expensive luxury. Even then—and on the basis of quite a modest start in terms of personnel—it can be expected to contribute usefully to the development of institutions (such as commercial banks and industrial and agricultural finance corporations) that will considerably assist in any programme that might be launched to further economic progress.
