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The Panic of 1857: Origins, Transmission, and Containment

Calomiris, Charles W.; Schweikart, Larry

We explain the origins of the Panic of 1857, examine its spread, and compare state banking systems's responses. We describe the decline in western land and railroad investments and the consequent stress on securities brokers and banks in eastern cities, and trace the transmission of the shock to other regions. Bank performance depended not only on regional conditions and links to eastern banks, but on the ability to coordinate behavior. Southern branch banks and coinsuring banks in Ohio and Indiana were particularly successful.

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Published In
Journal of Economic History
Publisher DOI
https://doi.org/10.1017/S0022050700040122
Volume
51
Issue
4
Pages
807 - 834
Academic Units
Business
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