The vagaries of the sea: evidence on the real effects of money from maritime disasters in the Spanish Empire

Adam Brzezinski, Yao Chen, Nuno Palma and Felix Ward

No 14089, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Maritime disasters in the Spanish Empire (1531-1810) resulted in the loss of substantial amounts of silver money. We exploit this recurring natural experiment to estimate the effect that an exogenous change in the money supply has on the real economy. We find that negative money supply shocks caused Spanish real output to decline. A transmission channel analysis highlights slow price adjustments and credit frictions as channels through which money supply changes affected the real economy. Especially large output declines occurred in textile manufacturing against the backdrop of a credit crunch that impaired merchants' ability to supply their manufacturers with inputs

Keywords: Natural experiment; Dsge; Monetary shocks; Financial accelerator; Nominal rigidity; Minimum-distance estimation; Local projection (search for similar items in EconPapers)
JEL-codes: E43 E44 E52 N10 N13 (search for similar items in EconPapers)
Date: 2022-05
New Economics Papers: this item is included in nep-dge, nep-his, nep-mac and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

Downloads: (external link)
https://cepr.org/publications/DP14089 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
Journal Article: The Vagaries of the Sea: Evidence on the Real Effects of Money from Maritime Disasters in the Spanish Empire (2024)
Working Paper: The vagaries of the sea: evidence on the real effects of money from maritime disasters in the Spanish Empire (2024)
Working Paper: The Vagaries of the Sea: Evidence on the Real Effects of Money from Maritime Disasters in the Spanish Empire (2022)
Working Paper: The vagaries of the sea: evidence on the real effects of money from maritime disasters in the Spanish Empire (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:14089

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP14089

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().