The Character and Denomination of Shares in the Victorian Equity Market

25 Pages Posted: 3 Jul 2012

See all articles by Graeme Acheson

Graeme Acheson

University of Stirling

John D. Turner

Queen's University Belfast; Queen's University Belfast - Queen's Management School

Qing Ye

Xi'an Jiaotong-Liverpool University (XJTLU)

Date Written: August 2012

Abstract

The seminal work of J. B. Jefferys highlighted two unusual features of the Victorian equity market, namely high share denomination and uncalled capital. This article examines the extent to which publicly traded company stocks in the nineteenth century had these features. It also analyses the effect of these features on stock returns using monthly data for the London Stock Market over the period 1825–70. We find that stocks with unpaid capital earned a higher return, which is consistent with investors being rewarded for the risk of a call on their personal assets. We also find that stocks with a high share denomination earned a lower return, which is consistent with the view that this feature was conducive to superior corporate governance.

Suggested Citation

Acheson, Graeme and Turner, John D. and Ye, Qing, The Character and Denomination of Shares in the Victorian Equity Market (August 2012). The Economic History Review, Vol. 65, Issue 3, pp. 862-886, 2012, Available at SSRN: https://ssrn.com/abstract=2098283 or http://dx.doi.org/10.1111/j.1468-0289.2011.00618.x

Graeme Acheson

University of Stirling ( email )

Stirling, Scotland FK9 4LA
United Kingdom

John D. Turner

Queen's University Belfast ( email )

David Leir Building
Belfast BT7 1NN, BT9 5AG
Ireland

Queen's University Belfast - Queen's Management School

Riddel Hall
185 Stranmillis Road
Belfast, BT9 5EE
United Kingdom

Qing Ye

Xi'an Jiaotong-Liverpool University (XJTLU) ( email )

111 Renai Road, SIP
Suzhou, JiangSu province 215123
China

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