The New England antebellum banking market was examined to understand the interaction of political ideology and economic forces. With each state controlling bank entry, hence the money supply, political ideology could impede the supply of money within a state. However, the monetary forces from neighboring states may have influenced the degree to which parties held true to their political ideology. The results indicate that political ideology was an effective barrier in two of the six states, while three states were responsive to neighbor states' monetary policy regardless of political ideology. These states responded by creating new banks, raising existing capital levels, or doing both.
Economopoulos, Andrew J., "Political Barriers and the Transmission of Monetary Policy Across States: The New England Antebellum Banking Market" (2003). Business and Economics Faculty Publications. 20.