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Shadow interest rates in Stockholm and the integration of early financial markets, 1660–1685: was Heckscher right?1


  • Edvinsson, Rodney


The decline of interest rates during the early modern period is considered an important factor in the subsequent rise of capitalist society. This article uses unique empirical material based on bills of exchange in Stockholm between 1660 and 1685 to estimate underlying ‘shadow interest rates’. It shows that annual rates ‘according’ to Stockholm were very high, mostly above 10 per cent, an indication of underdeveloped financial integration between Stockholm and the main European centres. There are also indications of a decline in these rates during the period studied, reflecting improved efficiency in Swedish financial markets.

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  • Edvinsson, Rodney, 2011. "Shadow interest rates in Stockholm and the integration of early financial markets, 1660–1685: was Heckscher right?1," Financial History Review, Cambridge University Press, vol. 18(3), pages 309-329, December.
  • Handle: RePEc:cup:fihrev:v:18:y:2011:i:03:p:309-329_00

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    Cited by:

    1. Leonor Freire Costa, & M. Manuela Rocha, & Paulo Brito, 2014. "Money Supply and the Credit Market in Early Modern Economies: The Case of Eighteenth-Century Lisbon," Working Papers GHES - Office of Economic and Social History 2014/52, ISEG - Lisbon School of Economics and Management, GHES - Social and Economic History Research Unit, Universidade de Lisboa.
    2. Nogues-Marco, Pilar, 2017. "Money Markets and Exchange Rates in Pre-Industrial Europe," Working Papers unige:100808, University of Geneva, Paul Bairoch Institute of Economic History.
    3. repec:bla:ehsrev:v:71:y:2018:i:4:p:1147-1172 is not listed on IDEAS

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