How Government Bond Prices Reflect Wartime Events. The Case of the Stockholm Market
AbstractHow are political events reflected in financial asset prices? Break points in sovereign debt prices are analyzed for Denmark, Norway, Finland, Sweden, Germany and Belgium during 1930-1948, using unique data from the Stockholm Stock Exchange. Unlike in countries involved in WWII, this market was unregulated. The outbreak of World War II heavily depressed prices of government bonds. Countries which were occupied (Belgium, Denmark and Norway) or under attack (Finland) saw their debt depreciate substantially. The battle of Stalingrad turns out indeed to be a turning-point of the war. This approach represents a complementary quantitative method to analyze the impact of political events.
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Bibliographic InfoPaper provided by Stockholm School of Economics in its series Working Paper Series in Economics and Finance with number 489.
Length: 24 pages
Date of creation: 17 Jan 2002
Date of revision:
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Financial Markets; Economic History; WWII; Europe; Cliometrics;
Other versions of this item:
- Daniel Waldenström & Bruno S. Frey, . "How Government Bond Prices Reflect Wartime Events - The Case of the Stockholm Market," IEW - Working Papers 102, Institute for Empirical Research in Economics - University of Zurich.
- F34 - International Economics - - International Finance - - - International Lending and Debt Problems
- G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
- N24 - Economic History - - Financial Markets and Institutions - - - Europe: 1913-
- N44 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: 1913-
This paper has been announced in the following NEP Reports:
- NEP-ALL-2002-02-10 (All new papers)
- NEP-EEC-2002-02-10 (European Economics)
- NEP-FMK-2002-02-10 (Financial Markets)
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