Law, Politics and the Rise and Fall of German Stock Market Development, 1870-1938

51 Pages Posted: 13 Jan 2015 Last revised: 12 Jun 2017

See all articles by Carsten Burhop

Carsten Burhop

Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Research on Collective Goods

David Chambers

University of Cambridge - Judge Business School; CEPR

Brian R. Cheffins

University of Cambridge - Faculty of Law; European Corporate Governance Institute (ECGI)

Date Written: January 1, 2015

Abstract

Law and politics had a significant impact on stock market development in Germany between 1870 and the beginning of World War II. IPOs can be a bellwether for stock market development and nearly 1100 were carried out on the Berlin Stock Exchange during this period. Regulatory changes occurring in the 1880s and 1890s contributed to a very high survival rate among those companies going public. The IPO market retained its vibrancy through the 1920s notwithstanding an infamous hyperinflation episode. Collapse followed, however, in the 1930s, at least partly due to regulatory changes inimical to the publicly quoted firm brought about by the ideological shifts under Nazi rule.

Keywords: Initial public offerings; Germany; Financial History; Corporate Law; Stock Markets

JEL Classification: N23, N24, G18, G24, K22

Suggested Citation

Burhop, Carsten and Chambers, David and Cheffins, Brian R., Law, Politics and the Rise and Fall of German Stock Market Development, 1870-1938 (January 1, 2015). European Corporate Governance Institute (ECGI) - Law Working Paper No. 283/2015; University of Cambridge Faculty of Law Research Paper No. 4/2015. Available at SSRN: https://ssrn.com/abstract=2548759 or http://dx.doi.org/10.2139/ssrn.2548759

Carsten Burhop

Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Research on Collective Goods ( email )

Kurt-Schumacher-Str. 10
D-53113 Bonn, 53113
Germany

David Chambers (Contact Author)

University of Cambridge - Judge Business School ( email )

Trumpington Street
Cambridge, CB2 1AG
United Kingdom
44 (0)1223 339700 (Phone)

CEPR ( email )

London
United Kingdom

Brian R. Cheffins

University of Cambridge - Faculty of Law ( email )

10 West Road
Cambridge, CB3 9DZ
United Kingdom
+44 1223 330084 (Phone)
+44 1223 330055 (Fax)

European Corporate Governance Institute (ECGI)

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

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