Download This PaperThe Mother of All Sudden Stops: Capital Flows and Reversals in Europe, 1919-32
53 Pages Posted: 25 Oct 2013 Last revised: 3 Jul 2022
Date Written: October 2013
Abstract
We present new data documenting European capital issues in major financial centers from 1919 to 1932. Push factors (conditions in international capital markets) perform better than pull factors (conditions in the borrowing countries) in explaining the surge and reversal in capital flows. In particular, the sharp increase in stock market volatility in the major financial centers at the end of the 1920s figured importantly in the decline in foreign lending. We draw parallels with Europe today.
Suggested Citation: Suggested Citation
Accominotti, Olivier and Eichengreen, Barry, The Mother of All Sudden Stops: Capital Flows and Reversals in Europe, 1919-32 (October 2013). NBER Working Paper No. w19580, Available at SSRN: https://ssrn.com/abstract=2345074
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