‘t Hart M. (2009) Trust your friends, buy annuities

September 1, 2009

‘t Hart, Marjolein (2009) “Mutual Advantages: State Bankers as Brokers between the City of Amsterdam and the Dutch Republic”, in The Political Economy of the Dutch Republic, ed. Oscar Gelderblom, p.115-142.

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The Dutch public credit in the early modern period enjoyed a uniquely high standing; but how did it work? (p.116). The sale of the securities to the public were in the hands of a district receiver who earned a brokerage of 0.5% (p.118). It took political and family connection to accede the position as well as a significant amount of wealth (p.120). “The personal wealth of this agent radiated from his office and thus supported the credit of the state”. Besides, the position could be quite rewarding financially. 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.

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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 »