Frehen R., Goetzmann W. and Rouwenhorst G. (2009) Why invest in the bubbles?

August 31, 2009

Frehen, Rik, William Goetzmann and Geert Rouwenhorst (2009) “New Evidence on the First Financial Bubbles”, Yale international Center for Finance, Working Paper 04, 24p.

Picture 8Picture 10Picture 9

This article is available online.

Why did investors decide to bet on the various companies that would form the three 1720 bubbles in France, England and the Netherlands? (p.1). How did these bubbles affect companies which unlike the Compagnie des Indes and the South Sea Company were neither involved in the Atlantic trade nor in public finance?

Read the rest of this entry »

Advertisements

Quinn S. (2001) Public debt to private finance: “Drop dead”

August 12, 2009

Quinn, Stephen (2001) “The Glorious Revolution’s Effect on English Private Finance: A Microhistory 1680-1705”, The Journal of Economic History, 61/3: 593-615.

Picture 5Picture 4Picture 6

Disclaimer: this summary is written by the contributors of the blog and not by the author of the article. Any mistake is Manuel’s fault (and he shall be punished).

Introduction

According to North and Weingast’s famous thesis, the investiture of William III of England in 1688, the “Glorious Revolution”, triggered a quick modernization of the British financial system – prompting in turn a fall of the interest rates. But the arrival of the new king also led the realm into a new war against France which lasted nine years and increased public debt from £1 million to £19 million (⅓ of the national income; p.593). Read the rest of this entry »


Carlos A., Key J. and Dupree J. (1998) Early finance’s learning curve

August 10, 2009

Carlos, Ann M., Jennifer Key and Jill L. Dupree (1998) “Learning and the Creation of Stock-Market Institutions: Evidence from the Royal African and Hudson’s Bay Companies, 1670-1700”, The Journal of Economic History, 58/2: 318-344.

Picture 5Picture 4Picture 6

Disclaimer: this summary is written by the blog and not by the authors of the article. Any mistake is Manuel’s fault.

Introduction

“England’s emergence as an international trading nation in the seventeenth century can be linked to the growth of trading arrangements that allowed for a longer life of capital either […] as a joint-stock trading company” (p.318).

According to North and Weingast’s famous thesis this emergence was made possible by the reforms brought by the 1688 Glorious Revolution. However the authors underline the fact that markets don’t grow instantaneously and it takes some times for the actors to learn how to use the market (p.319). Read the rest of this entry »


Clingingsmith D. and Williamson J. (2008) The world conjuration against the Indian industry

August 2, 2009

Clingingsmith, David and Williamson, Jeffrey G. (2008) “Deindstrialization in 18th and 19th century India: Mughal decline, climate shocks and British industrial ascent”, Exploration in Economic History, 45/3, 209-234.

Picture 1Picture 2Picture 3

Between 1700 and 1900, India went from being an industrial powerhouse to forgotten backwater. Why didn’t India manage to retain its edge and how did Britain overtake the giant? Read the rest of this entry »


Munro J. (2006) A non-mercantilist approach to the balance of payment problem

March 5, 2009

Munro, John H. (2006) “South German silver, European textiles, and Venetian trade with the Levant and Ottoman Empire, c. 1370 to c. 1720: a non-Mercantilist approach to the balance of payment problem”, in Relazione economiche tra Europea e mondo islamico, seccoli XII – XVII, ed. Simonetta Cavaciocchi, Florence: Le Monnier, 905-960.

mk_06_kw38_zmunro5u2fit8tjzplmmzbz

This article is available on line

Introduction

For mercantilists, gold and silver are not just mediums of exchange but the most tangible form of wealth (store of value) and a country’s veritable life-blood. In their view, the economic contraction of the later 14th and 15th centuries were caused by the outflow of precious metal to the East (p.905). But according to J. H. Munro, there was no such thing as a ‘bullion famine’, at worst some “periodic scarcity of coined money” in 1320-1340, 1370-1420, and 1440-1470 (p.906). Read the rest of this entry »