The macroeconomic effects of banking crises: evidence from the United Kingdom, 1750–1938

Seán Kenny*, Jason Lennard, John D. Turner

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

7 Citations (Scopus)
17 Downloads (Pure)

Abstract

This paper analyses the macroeconomic effects of banking crises in the United Kingdom between 1750 and 1938. We construct a new annual chronology of banking crises, which we define as episodes of runs and panics combined with significant, geographically-dispersed failures and suspensions. Using a vector autoregression, we find that banking crises are associated with short, sharp and significant drops in economic growth. Using the narrative record to identify plausibly exogenous variation, we show that this finding is robust to potential endogeneity.

Original languageEnglish
Article number101357
Number of pages18
JournalExplorations in Economic History
Volume79
Early online date24 Dec 2020
DOIs
Publication statusPublished - 01 Jan 2021

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