Austrian Business Cycle Theory - Related Policy Proposals

Related Policy Proposals

Many proponents of the Austrian School business cycle theory advocate free banking or full reserve banking with a monetary system based on a non-government commodity-money standard. If the central bank-fiat money system is maintained, they suggest heavy regulation of the banking system, enforcing a policy of full reserves on all deposit-taking institutions, or at least higher reserve requirements on all banks. Proponents of the theory generally oppose deregulation of the financial system without the prior abolition of central banks and the removal of deposit insurance.

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