Fifty Things that Made the Modern Economy

by Tim Harford

On Monday 4 May 1970, the Irish Independent, Ireland’s leading newspaper, published a matter-of-fact notice with a straightforward title: CLOSURE OF BANKS. Every major bank in Ireland was closed and would remain closed until further notice. The banks were in dispute with their own employees, the employees had voted to strike, and it seemed likely that the whole business would drag on for weeks or even months. You might think that such news – in what was one of the world’s more advanced economies – would inspire utter panic, but the Irish remained calm. They’d been expecting trouble, so they had been stockpiling reserves of cash, but what kept the Irish economy going was something else. The Irish wrote each other cheques. Now, at first sight this makes no sense. Cheques are paper-based instructions to transfer money from one bank account to another. But if both banks are closed, then the instruction to transfer money can’t be carried out.