But, one-byone, each of the former countries of the sterling area abandoned such a link, typically very soon after independence (Honohan and Lane, 1999). Some countries were motivated either by economic nationalism or a desire to exploit the apparent pro-growth potential of an autonomous currency. The break in other countries was driven by unsustainable expansionary moneyfinanced fiscal policy.
The Canadian record Now that we have established the principles for the well functioning of the financial system on the basis of research and of some elements of the theory, we can take a look at the Canadian record. To gain a broader perspective, let us step back in time to the Porter Commission.