The German twin crisis of 1931

Isabel Schnabel

No 02-48, Papers from Sonderforschungsbreich 504

Abstract: Using information on banks' balance sheets, we analyze the causal links between the banking and the currency problems in the German financial crisis of 1931. We find that the currency problems were caused by political shocks, while the problems in the banking sector were the result of excessive risk-taking by banks that were 'too big to fail'. Due to the high levels of foreign debt in the banking system, the run on the currency and the deposit withdrawals reinforced each other in a vicious circle and resulted in a banking panic and the abandonment of the gold standard.

Date: 2002
References: Add references at CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://madoc.bib.uni-mannheim.de/2783/1/dp02_48.pdf

Related works:
Journal Article: The German Twin Crisis of 1931 (2004)
Working Paper: The German Twin Crisis of 1931 (2002)
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:mnh:spaper:2783

Access Statistics for this paper

More papers in Papers from Sonderforschungsbreich 504 Contact information at EDIRC.
Bibliographic data for series maintained by Katharina Rautenberg ().