Abstract
A widespread historical pastime is fixing blame for a crisis geographically. President Hoover, for example, insisted that Europe was responsible for the 1929 depression. He was prepared to admit some fault in the United States, especially stock market speculation, but blamed the world as a whole for overproduction in wheat, rubber, coffee, sugar, silver, zinc, and, to some extent, cotton. Primarily, however, the fault belonged to Europe, with its cartels, and to “European statesmen [who] did not have the courage to face these issues.”1 Friedman and Schwartz, on the other hand, observe that while the gold-exchange standard rendered the international financial system vulnerable, the crisis originated in the United States. The initial climactic event—the stock market crash—was American, and the series of developments that started the stock of money downward in late 1930 was predominantly domestic.2
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Notes
8. International Contagion
Herbert Hoover, The Memoirs of Herbert Hoover (New York: Macmillan, 1952), vol. 3, pp. 61–62.
Milton Friedman and Anna J. Schwartz, A Monetary History of the United States, 1867–1960 (Princeton: Princeton University Press, 1963), pp. 359–60.
Quoted in Leone Levi, History of British Commerce (London: John Murray, 1872), p. 234.
S. Saunders, quoted in D. Morier Evans, The History ofthe Commercial Crisis, 1857–1858, and the Stock Exchange Panic of 1859 (1859; reprinted., New York: Augustus M. Kelley, 1969), p. 13.
R. C. O. Matthews, A Study in Trade-Cycle History: Economic Fluctuations in Great Britain, 1832–1842 (Cambridge: Cambridge University Press, 1954), p. 69.
Friedman and Schwartz, Monetary History, p. 360.
Jørgen Pedersen, “Some Notes on the Economic Policy of the United States During the Period 1919–1932,” in Hugo Hegelund, ed., Money, Growth and Methodology: Papers in Honor of Johan Akerman (Lund: Lund Social Science Studies, 1961),
reprinted in J. Pedersen, Essays in Monetary Theory and Related Subjects (Copenhagen: Samfundsvienskabeligt Forlag, 1975), p. 189.
R. T. Naylor, The History of Canadian Business, 1867–1914, vol. 1, The Banks and Finance Capital (Toronto: James Lorimer & Co., 1975), p. 130.
Clément Juglar, Des crises commerciales et leur retour périodique en France, en Angleterre et aux Etats-Unis, 2nd ed. (1889; reprint ed., New York: Augustus M. Kelley, 1967), pp. xiv, 17, 47, 149, and passim.
Wesley C. Mitchell, introduction to Willard L. Thorp, Business Annals (New York: National Bureau of Economic Research, 1926), pp. 88–97.
Oskar Morgenstern, International Financial Transactions and Business Cycles (Princeton, N.J.: Princeton University Press, 1959), chap. 1, esp. sec. 6; on international stock exchange panics from 1893 to 1931, see table 139, pp. 546–47, and chart 72, p. 548.
See my “The International (and Interregional) Aspects of Financial Crises,” in Martin Feldstein, ed., The Risk of Economic Crisis (Chicago: University of Chicago Press, 1991), pp. 128–32.
Friedman and Schwartz, Monetary History, p. 360.
Ibid., p. 308.
See C. E. V. Borio, N. Kennedy, and S.D. Prowse, “Exploring Aggregate Price Fluctuations Across Countries: Measurement, Determinants, and Monetary Policy Implications,” BIS Economic Papers, no. 40 (April 1994), Graph A.1, p. 74.
C. P. Kindleberger, “The Economic Crisis of 1619 to 1623,” Journal of Economic History, vol. 51, no. 1 (March 1991), esp. pp. 159–61.
Johan Akerman, Structure et cycles economiques (Paris: Presses universitaires de France, 1957), vol. 2, pp. 247, 255.
John Carswell, The South Sea Bubble (London: Cresset Press, 1960), pp. 84, 94, 100, 10l.
Ibid., pp. 151, 160–1, 166.
P. G. M. Dickson maintains that the Canton of Berne still held £287,000 of South Sea annuities in 1750 (The Financial Revolution in England: A Study in the Development of Public Credit, 1688–1756 [New York: St. Martin’s Press, 1967], p. 90).
Charles Wilson, Anglo-Dutch Commerce and Finance in the Eighteenth Century (Cambridge: Cambridge University Press, 1941), pp. 103, 124.
Carswell, South Sea Bubble, p. 167.
Ibid., pp. 178, 199.
T. S. Ashton, Economic Fluctuations in England, 1700–1800 (Oxford: Oxford University Press, Clarendon Press, 1959), p. 120.
George Chalmers, The Comparative Strength of Great Britain (London, 1782), p. 141, quoted in Ashton, Economic Fluctuations, p. 151.
E. E. de Jong-Keesing, De Economische Crisis van 1763 te Amsterdam (Amsterdam, 1939), pp. 216–17.
Wilson, Anglo-Dutch Commerce, p. 168.
De Jong-Keesing, Economische Crisis van 1763, p. 217.
Ernst Baasch, Hollandische Wirtschaftsgeschichte (Jena: Gustav Fischer, 1927).
Max Wirth, Geschichte der Handelskrisen, 4th ed. (1890; reprint ed., New York: Burt Franklin, 1968), p. 87.
Stephan Skalweit, Die Berliner Wirtschaftskrise von 1763 und ihre Hintergründe (Stuttgart/Berlin: Verlag W. Kohlhammer, 1937), p. 50.
Wilson, Anglo-Dutch Commerce, p. 168;
Alice Clare Carter, Getting, Spending and Investing in Early Modern Times: Essays on Dutch, English and Huguenot Economic History (Assen: Van Gorcum, 1975), p. 63.
William Smart, Economic Annals of the Nineteenth Century, vol. 1 (1911; reprinted., New York: Augustus M. Kelley, 1964), pp. 529–30.
Arthur D. Gayer, W. W. Rostow, and Anna J. Schwartz, The Growth and Fluctuation of the British Economy, 1790–1850 (Oxford: Oxford University Press, Clarendon Press, 1953), vol. 1, p. 159.
Smart, Economic Annals, vol. 1, chap. 31.
Murray N. Rothbard, The Panic of 1819: Reactions and Policies (New York: Columbia University Press, 1962), p. 11.
Bray Hammond, Banks and Politics in America from the Revolution to the Civil War (Princeton, N.J.: Princeton University Press, 1957), chap. 10, esp. pp. 253–62.
Maurice Lévy-Leboyer, Les banques europeennes et l’industrialisation internationale dans la premiere moitie du XIXe siècle (Paris: Presses universitaires de France, 1964), pp. 464–79.
Akerman, Structure et cycles economiques, p. 294.
Maurice Lévy-Leboyer, “Central Banking and Foreign Trade: The Anglo-American Cycle in the 1830s,” in C. P. Kindleberger and J.-P. Laffargue, eds., Financial Crises: Theory, History and Policy (Cambridge: Cambridge University Press, 1982), pp. 66–110.
R. G. Hawtrey, Currency and Credit, 3rd ed. (New York: Longmans, Green, 1927), p. 177.
Lévy-Leboyer, Banqueseuropeennes, pp. 570–83.
Juglar, Crises commerciales, p. 414.
Richard Tilly, Financial Institutions and Industrialization in the Rhineland, 1815–1870 (Madison: University of Wisconsin Press, 1970), p. 112.
Alfred Krüger, Das Kölner Bankiergewerbe vom Ende des 18. Jahrhunderts his 1875 (Essen: G. D. Baedeker Verlag, 1925), pp. 12–13, 35, 49, 55–56, 202–3.
P. E. Bergfalk, Bidrag till de under de sista hundrade aren inträffade handelskrisershistoria (Uppsala: Edquist, 1859),
Theodore E. Burton, Financial Crises and Periods of Industrial and Commercial Depression (New York: Appleton, 1902), pp. 128–29.
Sir John Clapham, The Bank of England: A History (Cambridge: Cambridge University Press, 1945), vol. 2, p. 226.
Hans Rosenberg, Die Weltwirtschaftskrise von 1857–1859 (Stuttgart: Verlag von W. Kohlhammer, 1934), p. 136.
Åkerman, Structure et cycles économiques, p. 323.
Clapham, Bank of England, vol. 2, p. 268.
See Currency and Credit, p. 177.
Shepard B. Clough, The Economic History of Modern Italy (New York: Columbia University Press, 1964), p. 53.
David S. Landes, Bankers and Pashas: International Finance and Economic Imperialism in Egypt (Cambridge, Mass.: Harvard University Press, 1958), p. 287.
Jürgen Schuchardt, “Die Wirtschaftskrise vom Jahre 1866 in Deutschland,” in Jahrbuch für Wirtschaftsgeschichte (East Berlin, 1962), pp. 107, 109, 133.
Wirth, Handelskrisen, pp. 462–63.
Larry T. Wimmer, “The Gold Crisis of 1869: A Problem in Domestic Economic Policy and International Trade Theory” (Ph.D. diss., University of Chicago, 1968 );
Wirth, Handelskrisen, p. 464.
U.S. Congress, House, Gold Panic Investigation, p. 132.
C. P. Kindleberger, “The Panic of 1873,” paper presented to the N.Y.U.-Salomon Brothers Symposium on Financial Panics, reprinted in my Historical Economics: Art or Science? (New York: Harvester/Wheatsheaf, 1990), pp. 310–25.
Henrietta M. Larson, Jay Cooke, Private Banker (Cambridge, Mass.: Harvard University Press, 1936).
Homer Hoyt, One Hundred Years of Land Values in Chicago: The Relationship of the Growth of Chicago to the Rise in Land Values, 1830–1933 (Chicago: University of Chicago Press, 1933), pp. 101–2, 117.
R. Ray McCartney, Crisis of 1873 (Minneapolis: Burgess, 1935), p. 85.
Morgenstern, International Financial Transactions, p. 546.
Fritz Stern, Gold and Iron: Bismarck, Bleichroder, and the Building of the German Empire (London: Allen & Unwin, 1977), p. 189.
Morgenstern, International Financial Transactions, p. 548.
L. S. Pressnell, “The Sterling System and Financial Crises Before 1914,” in C. P. Kindleberger and J.-P. Laffargue, eds., Financial Crises, pp. 148–64.
O. M. W. Sprague, History of Crises Under the National Banking System (1910; reprinted., New York: Augustus M. Kelley, 1968), p. 132.
C. P. Kindleberger, “International Propagation of Financial Crises: The Experience of 1888–93,” in idem, Keynesianism vs. Monetarism and Other Essays in Financial History (London: Allen & Unwin, 1985), pp. 226–39.
Franco Bonelli, La crisi del1907: una tappa dello sviluppo industriale in Italia (Turin: Fondazione Luigi Einaudi, 1971).
Franco Bonelli, “The 1907 Financial Crisis in Italy: A Peculiar Case of the Lender of Last Resort in Action,” in C. P. Kindle berger and J.-P. Laffargue, eds., Financial Crises, pp. 51–65.
Franco Bonelli, La crisi del 1907, pp. 31–32.
Ibid., p. 34.
Ibid., pp. 42–43.
Frank Vanderlip, “The Panic as a World Phenomenon,” Annals of the American Academy of Political and Social Science, vol. 31 (January–June 1908), p. 303.
C. P. Kindleberger, The World in Depression, 1929–1939, 2nd ed. (Berkeley: University of California Press, 1986), esp. chap. 7.
H. W. Arndt and Hal Hill, eds., “South East Asia’s Economic Crisis: Origins, Lessons and the Way Forward,” Asian Economic Bulletin, vol. 15, no. 3 (December 1998), passim.
“Who Went Under in the World’s Sea of Cash?” New York Times, February 15, 1999, pp. A10, A11;
“How U.S. Wooed Asia to Let the Cash Flow In,” New York Times, February 16, 1999, pp. A1, A10, A11;
“Of World Markets None Is an Island,” New York Times, February 17, 1999, pp. A1, A8, A9;
“World’s Ills Are Obvious, the Cures Much Less So,” New York Times, February 18, 1999, pp. A1, A14, A15.
See Edward Shaw, Financial Deepening in Economic Development (New York: Oxford University Press, 1973);
Roland I. McKinnon, Money and Capitalism in Economic Development (Washington, D.C.: Brookings Institution, 1973);
and John Williamson and Molly Mohar, “A Survey of Financial Liberalization,” Essays in International Finance, no. 221 (Princeton, N.J.: International Finance Section, November 1998).
Andrew Mcintyre, “Political Institutions and the Economic Crisis in Thailand and Indonesia,” Asian Economic Bulletin, vol. 15, no. 3 (December 1998), pp. 363–72.
“Turmoil in Brazil: Markets Rally but More Convulsions Are Possible,” New York Times, January 16, 1999, pp. A1, B4.
Franklin. E. Edwards, “Hedge Funds and the Collapse of Long-Term Capital Management,” Journal of Economic Perspectives, vol. 13, no. 2 (April 1999), pp. 189–210.
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Kindleberger, C.P., Bernstein, P.L. (2000). International Contagion. In: Manias, Panics and Crashes. Palgrave Macmillan, London. https://doi.org/10.1057/9780230536753_8
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