Home

Fundamentals, Panics, and Bank Distress During the Depression

Charles W. Calomiris; Joseph R. Mason

Title:
Fundamentals, Panics, and Bank Distress During the Depression
Author(s):
Calomiris, Charles W.
Mason, Joseph R.
Date:
Type:
Articles
Department:
Business
Volume:
93
Permanent URL:
Book/Journal Title:
American Economic Review
Abstract:
We assemble bank-level and other data for Fed member banks to model determinants of bank failure. Fundamentals explain bank failure risk well. The first two Friedman-Schwartz crises are not associated with positive unexplained residual failure risk, or increased importance of bank illiquidity for forecasting failure. The third Friedman-Schwartz crisis is more ambiguous, but increased residual failure risk is small in the aggregate. The final crisis (early 1933) saw a large unexplained increase in bank failure risk. Local contagion and illiquidity may have played a role in pre-1933 bank failures, even though those effects were not large in their aggregate impact.
Subject(s):
Economic history
Banking
Publisher DOI:
10.1257/000282803322655473
Item views:
240
Metadata:
View

In Partnership with the Center for Digital Research and Scholarship at Columbia University Libraries/Information Services.