International Banking and Transmission of the 1931 Financial Crisis
In: The Economic History Review, Band 72, Heft 1, S. 260-285
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In: The Economic History Review, Band 72, Heft 1, S. 260-285
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In: The economic history review, Band 72, Heft 1, S. 260-285
ISSN: 1468-0289
AbstractIn May to July 1931, a series of financial panics shook central Europe before spreading to the rest of the world. This article explores the role of cross‐border banking linkages in propagating the central European crisis to Britain and the US. Using archival bank‐level data, the article documents US and British banks' exposure to central European frozen credits in 1931. Central European lending was mostly done by large and diversified commercial banks in the US and by small and geographically specialized merchant banks/acceptance houses in Britain. Differences in the organization of international bank lending explain why the central European crisis disturbed few US banks but endangered many British financial institutions.
In: CEPR Discussion Paper No. DP11651
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Working paper
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Working paper
In: The journal of economic history, Band 72, Heft 4, S. 1109-1111
ISSN: 1471-6372
In: The journal of economic history, Band 72, Heft 1, S. 1-43
ISSN: 1471-6372
The Central European panic of the spring 1931 is often presented as a cause of the sterling crisis of September. But what was the transmission channel? This article explores how the continent's financial troubles affected Britain's banking system. The freeze of Central European assets created a liquidity strain for London merchant banks because they had accepted (guaranteed) the commercial bills of German merchants. I use new balance sheet data to quantify this shock and explore how the liquidity crisis contributed to the sterling crisis. The evidence demonstrates that international contagion was crucial in transmitting the 1931 global financial crisis.
In: The economic history review, Band 63, Heft 4, S. 1207-1208
ISSN: 1468-0289
In: The economic history review, Band 62, Heft 4, S. 1030-1032
ISSN: 1468-0289
In: CEPR Discussion Paper No. DP13661
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Working paper
In: The Oxford Handbook of Institutions of International Economic Governance and Market Regulation, 2019
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Working paper
In: The journal of economic history, Band 76, Heft 2, S. 342-386
ISSN: 1471-6372
This article explores the risks and returns to currency speculation during the 1920s and 1930s. We study the performance of two well-knowntechnicaltrading strategies (carry and momentum) and compare them with that of afundamentals-basedtrader: John Maynard Keynes. Technical strategies were highly profitable during the 1920s and even outperformed Keynes. In the 1930s, however, both technical strategies and Keynes performed relatively poorly. While our results reveal the existence of profitable opportunities for currency traders in the interwar years, they suggest that such profits were necessary compensation for enduring the substantial risks that all strategies entailed.
In: The economic history review, Band 69, Heft 2, S. 469-492
ISSN: 1468-0289
New data documenting European bond issues in major financial centres from 1919 to 1932 show that conditions in international capital markets and not just in borrowing countries are important for explaining the surge and reversal in capital flows. In particular, the sharp increase in stock market volatility in the major financial centres at the end of the 1920s figured importantly in the decline in foreign lending. This article draws parallels with Europe after 2008.
In: Forthcoming, Journal of Economic History
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In: NBER Working Paper No. w19580
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In: World politics: a quarterly journal of international relations, Band 60, Heft 2, S. 147-188
ISSN: 0043-8871
Textbook accounts of the Anglo-French trade agreement of 1860 argue that it heralded the beginning of a liberal trading order. This alleged success holds much interest from a modern policy point of view, for it rested on bilateral negotiations and most-favored-nation clauses. With the help of new data on international trade (the RIC ardo database), the authors provide empirical evidence and find that the treaty and subsequent network of MFN trade agreements coincided with the end of a period of unilateral liberalization across the world. They also find that it did not contribute to expanding trade at all. This is contrary to a deeply rooted belief among economists, economic historians, and political scientists. The authors draw a number of policy lessons that run counter to the conventional wisdom and raise skepticism toward the ability of bilateralism and MFN arrangements to promote trade liberalization. (World Politics / SWP)
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