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Effects of Federal Reserve services on the efficiency of the system for collecting checks in the United States: 1915--30
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Effects of Federal Reserve services on the efficiency of the system for collecting checks in the United States: 1915--30

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  • R. Alton Gilbert

Abstract

This paper investigates whether the services of the Federal Reserve System improved the efficiency of the system in the United States for collecting checks relative to the efficiency of the system used by banks just prior to the formation of the Federal Reserve. There are two types of evidence that the Fed's services improved efficiency. First, the Reserve Banks quickly became major processors of interregional checks, even though banks could have continued to use the prior payments arrangements. Second, declines in the ratios of cash to total assets of banks can be attributed to the development of the Fed's check collection services.

Suggested Citation

  • R. Alton Gilbert, 1999. "Effects of Federal Reserve services on the efficiency of the system for collecting checks in the United States: 1915--30," Working Papers 1999-014, Federal Reserve Bank of St. Louis.
    • Handle: RePEc:fip:fedlwp:1999-014
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    References listed on IDEAS

    as
    1. Jeffrey M. Lacker & Jeffrey D. Walker & John A. Weinberg, 1999. "The Fed's entry into check clearing reconsidered," Economic Quarterly, Federal Reserve Bank of Richmond, issue Spr, pages 1-32.
    2. R. Alton Gilbert, 1998. "Did the Fed's founding improve the efficiency of the U.S. payments system?," Review, Federal Reserve Bank of St. Louis, issue May, pages 121-142.
    3. Miron, Jeffrey A, 1986. "Financial Panics, the Seasonality of the Nominal Interest Rate, and theFounding of the Fed," American Economic Review, American Economic Association, vol. 76(1), pages 125-140, March.
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    Cited by:

    1. Khiaonarong, Tanai, 2003. "Payment systems efficiency, policy approaches, and the role of the central bank," Bank of Finland Research Discussion Papers 1/2003, Bank of Finland.
    2. Tanai Khiaonarong, 2004. "Payment systems efficiency, policy approaches, and the role of the central bank," Finance 0405004, University Library of Munich, Germany.
    3. Khiaonarong, Tanai, 2003. "Payment systems efficiency, policy approaches, and the role of the central bank," Research Discussion Papers 1/2003, Bank of Finland.
    4. repec:zbw:bofrdp:2003_001 is not listed on IDEAS

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