Economics - Theses
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ItemExport credit insurance schemes and manufactured exports with particular reference to Australia 1960-1972( 1975)Credit insurance, which may be regarded as a part of casualty insurance, is a means of reducing the risk in credit operations, whether for domestic or overseas transactions. The terms “insurance” and "guarantee" are often used interchangeabley. For example, in Australia there is the Export Payments Insurance Corporation, and the counterpart organisation in the United Kingdom is the Export Credits Guarantee Department. The second half of the 19th century saw attempts by private companies in Europe to apply insurance principles to credit risks (domestic or domestic and export credit risks). But most were destined to failure because they considered it their duty not only to meet the claims of their clients but also to come to their financial assistance, so failing to distinguish between the function of insurance and banking. In Britain, Australia played a part in developing export credit insurance as it is now known when financial difficulties in Australia in the 1890's made British merchants shipping goods to Australia lose confidence in bills drawn on their Australian buyers. This led to a demand for insurance to cover the export credit risks. The few companies that were formed to meet this demand failed because they underwrote too many export risks and carried the whole of the loss, thereby giving the insured no inducement to limit his commitments. The risks in foreign trade covered by these private companies in the 19th century were only commercial risks with political risks excluded because of their large potential losses. Commercial risks refer to the financial position of the importer and his ability to meet the debts when due, whilst political risks relate to factors beyond the control of the importer, such as war in his country, which prevent payment. The reasons for the failure of credit insurance in Britain were not lost on Mr. Cuthbert Heath, a member of Lloyd's, and it was he who formulated the two basic principles upon which credit insurance (whether domestic or overseas) is now based. These were: (1) the risks covered must be a genuine average of all risks; and (2) cover should not be provided for the whole of the credit risk. He appeared on the credit insurance scene near the end of the 19th century, although it was not until 1903 that the Excess Insurance Company, established by him in 1894, commenced underwriting credit insurance. (From Introduction)
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ItemThe growth and development of the Commissioners' Savings Banks in Victoria 1875-1900( 1973)I have chosen the years 1875-1900 in the history of the Commissioners’ Saving Banks in Victoria (forerunners of the State Savings Bank) because this short span contained so many momentous events in Australian banking history, and it is tempting to fit the institution into the overall picture, but also because it embraced the second major period of expansion of the network of offices, and saw a dramatic change in the role and function of the Savings Bank. The previous period of expansion had occurred largely as the result of the discovery of gold in the 1850s and the need for saving facilities in country districts. It had come to an end because of the Commissioners’ inability to satisfy the requests for further Savings Banks with the limited resources at their disposal. This inability led them to suggest the establishment of post office savings bank facilities, with the expectation, it has been claimed that these new offices be entrusted to their supervision. This was not to be so but the commissioners nevertheless welcomed the new system as providing a satisfactory means of reaching the small saver in all the settled areas of the colony and relieving them of the costly obligation of opening further offices. From 1862 until 1879, therefore, no addition to the existing network of Banks was contemplated and this period quite clearly separates and defines the two periods of expansion. The second expansionary phase, with which we are about to deal, was a largely metropolitan one and therefore entirely different from its predecessor. It was essentially part of that remarkable period in Victorian economic history, the 1880s and 1890s, during which there was so much expansion in Melbourne in the fields of construction and public transport, but also in the realms of finance. Much has been written about the various other financial organisations that grew and proliferated as a result of the very extensive overseas borrowing and the buoyancy of the export market for the colony’s staples, but the savings banks have largely been neglected. This is surprising for they were well established in eastern Australia before the 1880s and played a not insignificant role in the events of the two decades prior to 1900. In Melbourne, particularly, the path pursued by the Commissioners’ Savings Banks so closely paralleled the course of economic events that it is possible to gain considerable insight into the manner in which ordinary business decision were influenced by and contributed to the cumulative optimism of the boom and, conversely, how they collectively accentuated the rigours of the ensuing depression.