State and Finance in the Philippines, 1898-1941: The Mismanagement of an American Colony

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During the First World War, ill-advised steps by colonial officials in the Philippines created a financial crisis which lasted from 1919 until 1922. The circumstances shook the foundations of the American colonial state and contributed to Manuel L. Quezon's successful effort to replace Sergio Osmeña as leader of the politically dominant Nacionalista Party. These events have generally been blamed on a corruption scandal at the Philippine National Bank, which had been established in 1916 as a multi-purpose, semi-governmental agency whose purpose was to provide loans for the agricultural export industry, to do business as a commercial bank, to issue bank notes, and to serve as a depository for government funds.

Based on detailed archival research, Yoshiko Nagano argues that the crisis in fact resulted from mismanagement of currency reserves and irregularities in foreign exchange operations by American officials, and that the notions of a "corruption scandal" arose from a colonial discourse that masked problems within the banking and currency systems and the U.S. colonial administration. Her analysis of this episode provides a fresh perspective on the political economy of the Philippines under American rule, and suggests a need for further scrutiny of historical accounts written on the basis of reports by colonial officials.


"Nagano’s contribution to Philippine political economy and history, especially during the American colonial period, is unmistakable and significant. This book is a must-read for earnest students of Philippine political economy and history."
Vicente Angel Ybiernas, De La Salle University

"In her fine rendering, the Philippines was not an outlier in colonial Southeast Asia. It is a harbinger of the US-dominated global economy to come"
Theresa Ventura, Concordia University


Yoshiko Nagano is Professor of International Relations and Asian Studies at Kanagawa University in Yokohama, Japan. She is also the co-editor of The Philippines and Japan in America's Shadow.


Publication Year: 2015
272 pages, 229mm x 152mm
ISBN: 978-9971-69-841-6, Paperback

NUS Press

Related Title:
Central Banking as State Building: Policymakers and Their Nationalism in the Philippines, 1933-1964 by Yusuke Takagi