Inflation, political instability and stockmarket volatility in interwar Germany

Hans-Joachim Voth

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: What determined the volatility of asset prices in Germany between the wars? This paper argues that the influence of political factors has been overstated. The majority of events increasing political uncertainty had little or no effect on the value of German assets and the volatility of returns on them. Instead, it was inflation (and the fear of it) that is largely responsible for most of the variability in asset returns.

Keywords: Inflation; stock returns; volatility of asset returns; political uncertainty; Germany (interwar) (search for similar items in EconPapers)
JEL-codes: G14 G15 E44 E31 N14 N24 (search for similar items in EconPapers)
Date: 2001-03
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Persistent link: http://EconPapers.repec.org/RePEc:upf:upfgen:535

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