The Importance of Banks: The First Bank in the United States

Abstract

In this teaching project I present an experience carried out with students of the Degree in Political Science at the University of Murcia (Spain) within the subject "Principles of Economics". Given the context in which it is taught, it is necessary to explain economic concepts reducing the mathematical part as much as possible. For this reason, I have used historical texts from the United States.
Students participate in two rounds of a role play to help them understand the role of banks in facilitating economic growth through loans. Round 1 is conducted without a bank. After the first round, students read excerpts from Secretary of the Treasury Alexander Hamilton’s 1790 report to Congress in which he proposes a national bank because the United States had few banks at the time. In this report, Hamilton made a case for how banks should work and dispelled rumors about banking in this report sent to Congress.
Students then conduct Round 2 of the role play with a bank. After the round, students read excerpts from and summaries of the statute creating a national bank, Thomas Jefferson’s opposition to the national bank (February 15, 1791, Letter to President George Washington), and Hamilton’s rebuttal. This experience shows how historical events and developments were shaped by unique circumstances of time and place as well as broader historical contexts. Students realize the role of financial institutions as channelers of funds between savers and investors, as well as the relevance of the interest rate on deposits and loans.



Author Information
Cristina Vilaplana-Prieto, University of Murcia, Spain

Paper Information
Conference: ACE2023
Stream: Higher education

The full paper is not available for this title


Virtual Presentation


Comments & Feedback

Place a comment using your LinkedIn profile

Comments

Share on activity feed

Powered by WP LinkPress

Share this Research

Posted by James Alexander Gordon