Francisco Barrera Lavalle: Early Twentieth-century Mexican Currency and Banking Specialist. Critic of the 1905 Monetary Reform by Which Mexico Adopted the Gold Standard

Abstract

This essay explores the critical vision of Francisco Barrera Lavalle about the Mexico’s Monetary Reform of 1905. In his critique, Barrera inserts an argument about the nature of the balance of payments in the Mexican economy: the disequilibria in Mexico’s trade balance were structurally recurrent given the characteristics of what the country exports: commodities and raw materials. Barrera believed that the authorities made the mistake of overvaluing the peso, assigning it a value higher than what silver currency was worth at the time on international markets. Barrera also dismissed the idea that monetary stability could be achieved by suspending the free coinage of silver currency. Finally, Barrera held that banks should be obligated to pay their banknotes in gold, as they were in Great Britain and in the United States, not in silver coins.

Citation

Rosales, R.S. (2018), "Francisco Barrera Lavalle: Early Twentieth-century Mexican Currency and Banking Specialist. Critic of the 1905 Monetary Reform by Which Mexico Adopted the Gold Standard", Including a Symposium on Latin American Monetary Thought: Two Centuries in Search of Originality (Research in the History of Economic Thought and Methodology, Vol. 36C), Emerald Publishing Limited, Leeds, pp. 29-53. https://doi.org/10.1108/S0743-41542018000036C003