The Origins of Blackwell's Model of a Bank

NE of the earliest of the many schemes for issuing paper money which grew out of the early colonists' shortage of cash was devised by Captain John Blackwell at Boston. We know of it partly through entries in the Massachusetts Archives, and partly from two versions of the plan prepared by Blackwell himself. The earlier of these two, entitled Discourse in Explanation of the Bank of Credit' exists in a manuscript; whether it was printed is uncertain. The second version, entitled A Model for Erecting a Bank of Credit: ivith a Discourse in Ex2 planation thereof . . . , was printed partly in London and partly in Boston. It is dated i688, but there is a slight mystery about its date, as will appear. The Model was partly reprinted in Boston in I7I4. The circumstances surrounding the appearance of Blackwell's proposals have been exhaustively studied by Andrew McFarland Davis and Joseph Dorfman;4 it will be sufficient here to recapitulate briefly what is pertinent to our discussion. Captain Blackwell declared for the Parliamentary side in the Civil War, and became Treasurer of War and Receiver General of Assessments under Cromwell. In i656 he was elected Member of Parliament for Surrey. Upon the Restoration he lost his posts and much of his land. For the next twenty-five years we have almost no news of him. In i684, however, he left London for New England, where he was welcomed by his fellowIndependents. In June i686 Blackwell was made a justice of the peace in Massachusetts, and at about the same time he submitted to the President and Council, on behalf of himself and divers others, his participants, as well in England as in this Countrey, the banking scheme subsequently de* Mr. Horsefield is Chief Editor, International Monetary Fund, Washington, D. C. 1 Reprinted in Andrew McFarland Davis, ed., Colonial Currency Reprints, 1682I75I (Boston, i9io-Ii, reprinted New York, i964), I, I22-I46; hereafter cited as CCR. 2 ibid., I54-i87. 3 Ibid., 2IO-237. 4lbid., 8-2i, I46-i5i, i87-i88, 237-238; Joseph Dorfman, The Economic Mind in American Civilization (New York, I946-49), I, 96-iio; and Dorfman, last two (unnumbered) pages of Introduction to CCR, i964 ed

Economic Theory and Policy · Economic, financial, and policy analysis · History

• Why was America's First Bank Aborted

  Open Access•Dror Goldberg•The Journal of Economic History•2011

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