International Banking and Transmission of the 1931 Financial Crisis

26 Pages Posted: 18 Jan 2019

See all articles by Olivier Accominotti

Olivier Accominotti

London School of Economics & Political Science (LSE); Centre for Economic Policy Research (CEPR)

Multiple version iconThere are 2 versions of this paper

Date Written: February 2019

Abstract

In May to July 1931, a series of financial panics shook central Europe before spreading to the rest of the world. This article explores the role of cross‐border banking linkages in propagating the central European crisis to Britain and the US. Using archival bank‐level data, the article documents US and British banks’ exposure to central European frozen credits in 1931. Central European lending was mostly done by large and diversified commercial banks in the US and by small and geographically specialized merchant banks/acceptance houses in Britain. Differences in the organization of international bank lending explain why the central European crisis disturbed few US banks but endangered many British financial institutions.

Suggested Citation

Accominotti, Olivier, International Banking and Transmission of the 1931 Financial Crisis (February 2019). The Economic History Review, Vol. 72, Issue 1, pp. 260-285, 2019. Available at SSRN: https://ssrn.com/abstract=3317742 or http://dx.doi.org/10.1111/ehr.12736

Olivier Accominotti (Contact Author)

London School of Economics & Political Science (LSE) ( email )

Economic History Department
Houghton Street
London, WC2A 2AE
United Kingdom

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

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