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Banks and the economy: evidence from the Irish Bank Strike of 1966

Author

Listed:
  • Horgan, Emma
  • Kenny, Seán
  • Lennard, Jason

Abstract

This paper studies the macroeconomic impact of the Irish bank strike of 1966, which led to the closure of the major commercial banks for three months. We collect a variety of new evidence, such as high-frequency macro data, economic forecasts, micro data and narrative sources. Our findings suggest that the bank strike was associated with a shortfall in economic activity that punctuated a decade of robust growth. The qualitative evidence depicts the struggles of households and firms managing a credit crunch, a liquidity shock and rising transaction costs. This case study highlights the importance of banks for economic performance.

Suggested Citation

  • Horgan, Emma & Kenny, Seán & Lennard, Jason, 2026. "Banks and the economy: evidence from the Irish Bank Strike of 1966," LSE Research Online Documents on Economics 140423, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:140423
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    File URL: https://researchonline.lse.ac.uk/id/eprint/140423/
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    Keywords

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    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • N14 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Europe: 1913-
    • N24 - Economic History - - Financial Markets and Institutions - - - Europe: 1913-

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