Using Markets to Measure Pre-War Threat Assessments: The Nordic Countries facing World War II
Nordic historians have asserted for a long time that in the Nordic countries only few people, if any, perceived increased threats of war prior to the World War II outbreak. This would explain, and possibly excuse, why their governments did not mobilize their armies until it was too late. This paper questions this established notion by deriving new estimates of widely held war threat assessments from the fluctuations of sovereign market yields collected from all Nordic bond markets at this period. Our results show that the Nordic contemporaries indeed perceived significant war risk increases around the time of major war-related geopolitical events. While these findings hence question some, but not all, of the standard Nordic World War II historiography, they also demonstrate the value of analyzing historical market prices to reassess the often tacit views and opinions of large groups of people in the past.
|Date of creation:||Nov 2006|
|Date of revision:|
|Contact details of provider:|| Postal: Gellerstrasse 24, 4052 Basel|
Web page: http://www.crema-research.ch
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Roberto Rigobon & Brian P. Sack, 2003.
"The effects of war risk on U.S. financial markets,"
Finance and Economics Discussion Series
2003-18, Board of Governors of the Federal Reserve System (U.S.).
- Roberto Rigobon & Brian Sack, 2003. "The Effects of War Risk on U.S. Financial Markets," NBER Working Papers 9609, National Bureau of Economic Research, Inc.
- Rigobon, Roberto & Sack, Brian P., 2003. "The Effects of War Risk on U.S. Financial Markets," Working papers 4417-03, Massachusetts Institute of Technology (MIT), Sloan School of Management.
- Paye, Bradley S. & Timmermann, Allan, 2006. "Instability of return prediction models," Journal of Empirical Finance, Elsevier, vol. 13(3), pages 274-315, June.
- Brown, William O, Jr & Burdekin, Richard C K, 2002. "German Debt Traded in London during the Second World War: A British Perspective on Hitler," Economica, London School of Economics and Political Science, vol. 69(276), pages 655-69, November.
- Bruno S. Frey & Marcel Kucher, .
"History as Reflected in Capital Markets: The Case of World War II,"
IEW - Working Papers
002, Institute for Empirical Research in Economics - University of Zurich.
- Frey, Bruno S. & Kucher, Marcel, 2000. "History as Reflected in Capital Markets: The Case of World War II," The Journal of Economic History, Cambridge University Press, vol. 60(02), pages 468-496, June.
- Perron, P. & Bai, J., 1995.
"Estimating and Testing Linear Models with Multiple Structural Changes,"
Cahiers de recherche
9552, Universite de Montreal, Departement de sciences economiques.
- Jushan Bai & Pierre Perron, 1998. "Estimating and Testing Linear Models with Multiple Structural Changes," Econometrica, Econometric Society, vol. 66(1), pages 47-78, January.
- Perron, P. & Bai, J., 1995. "Estimating and Testing Linear Models with Multiple Structural Changes," Cahiers de recherche 9552, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
- Pierre Perron, 2005. "Dealing with Structural Breaks," Boston University - Department of Economics - Working Papers Series WP2005-017, Boston University - Department of Economics.
- Frey, Bruno S & Kucher, Marcel, 2001. "Wars and Markets: How Bond Values Reflect the Second World War," Economica, London School of Economics and Political Science, vol. 68(271), pages 317-333, August.
- Kristen L. Willard & Timothy W. Guinnane & Harvey S. Rosen, 1995.
"Turning Points in the Civil War: Views from the Greenback Market,"
NBER Working Papers
5381, National Bureau of Economic Research, Inc.
- Willard, Kristen L & Guinnane, Timothy W & Rosen, Harvey S, 1996. "Turning Points in the Civil War: Views from the Greenback Market," American Economic Review, American Economic Association, vol. 86(4), pages 1001-18, September.
- Kim Oosterlinck, 2003.
"The Bond Market and the Legitimacy of Vichy France,"
Working Papers CEB
03-003.RS, ULB -- Universite Libre de Bruxelles.
- Oosterlinck, Kim, 2003. "The bond market and the legitimacy of Vichy France," Explorations in Economic History, Elsevier, vol. 40(3), pages 326-344, July.
- Kim Oosterlinck, 2003. "The bond market and the legitimacy of Vichy France," ULB Institutional Repository 2013/142693, ULB -- Universite Libre de Bruxelles.
- Justin Wolfers & Eric Zitzewitz, 2009. "Using Markets to Inform Policy: The Case of the Iraq War," Economica, London School of Economics and Political Science, vol. 76(302), pages 225-250, 04.
When requesting a correction, please mention this item's handle: RePEc:cra:wpaper:2006-27. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Anna-Lea Werlen)
If references are entirely missing, you can add them using this form.