Interest-bearing Currency: Evidence from the Civil War Experience
通过美国内战时期的证据，检验了法定限制理论对无息货币与有息政府债券共存悖论的解释，探讨了政府发行小面额有息票据对货币流通的影响。
The coexistence of alternative assets, some of which have significantly higher yields or returns than others, has long been regarded by many as one of the main puzzles facing monetary (Hicks 1935). The apparently paradoxical coexistence of non-interest-bearing currency and interest-bearing government debt is attributed by the proponents of the restrictions theory to legal restrictions on private intermediation (such as prohibitions against private bank note issue) and to the refusal of the government to issue small-denomination bearer bonds. Securities such as U.S. savings bonds, which are issued in small denominations, cannot displace non-interest-bearing Federal Reserve Notes because they are nonnegotiable while those securities that are negotiable and were, until recently, bearer securities, are said to have always been issued in large denominations (Wallace 1983, pp. 1-2). In support of this contention, Wallace presents two scenarios. In the first, he asks us to suppose that the Treasury were to issue small-denomination, interest-bearing bearer notes. He then argues that so long as the Treasury notes carried a positive return while Federal Reserve notes did not, everyone would prefer the Treasury notes. It follows from this that either the rate of return on Treasury notes must fall to zero or Federal Reserve notes must disappear from circulation. Thus, Wallace concludes, non-interest-bearing currency cannot coexist with interest-bearing, defaultfree securities unless the latter are nonnegotiable or are issued only in large denominations. By themselves, these conditions are not sufficient to explain the coexistence paradox because they do not rule out arbitrage between interest-bearing notes such as Treasury bills and small denomination notes. Hence, the second scenario. This is a laissez-faire regime in which financial institutions engage in arbitrage between riskfree interest-bearing Treasury securities and small-denomination notes issued by those intermediaries. This, it is argued, gives rise to the same situation that prevails if the Treasury itself issues small-denomination bearer securities. Non-interestbearing currency could survive only if the yield on interest-bearing notes was also zero. Given free entry into the intermediation business, the yield on large-de-