Journal article
The London money market and non-British bank lending during the first globalisation: evidence from Brazil
- Abstract:
- This study examines the relationship between the London money market (LMM) and the credit provision of non-British overseas banks in peripheral economies during the first wave of globalisation. Using monthly data between 1889 and 1913, we find a positive relationship between the amount of credit authorised by the German Brasilianische Bank für Deutschland in Brazil and the spread between the London market and floating rate. Our results suggest that increased demand for foreign bills and/or decreased borrowing costs in the LMM leads to an increase in credit supply. We use the impact of annual tax payments on the spread between the market and floating rate as an instrumental variable (IV) to show that this relationship is causal. Although there is a significant amount of literature on London’s historic role as a global financial centre and a growing number of studies on foreign banking history, little quantitative evidence is available about the connection between the two. This study bridges this gap.
- Publication status:
- Published
- Peer review status:
- Peer reviewed
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(Preview, Version of record, pdf, 1.6MB, Terms of use)
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- Publisher copy:
- 10.1007/s11698-024-00284-5
Authors
+ European Research Council
More from this funder
- Funder identifier:
- https://ror.org/0472cxd90
- Grant:
- 883758
- Publisher:
- Springer
- Journal:
- Cliometrica More from this journal
- Volume:
- 19
- Issue:
- 1
- Pages:
- 81-122
- Publication date:
- 2024-04-15
- Acceptance date:
- 2024-02-28
- DOI:
- EISSN:
-
1863-2513
- ISSN:
-
1863-2505
- Language:
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English
- Keywords:
- Pubs id:
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1729782
- Local pid:
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pubs:1729782
- Deposit date:
-
2024-03-04
Terms of use
- Copyright holder:
- Kisling et al.
- Copyright date:
- 2024
- Rights statement:
- © The Author(s) 2024. Open Access. This article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence, and indicate if changes were made. The images or other third party material in this article are included in the article's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the article's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder.
- Licence:
- CC Attribution (CC BY)
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