Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. An electronic version of the paper may be downloaded Terms of use: Documents in EconStor may• from the SSRN website:www. SSRN.com • from the RePEc website:www. RePEc.org • from the CESifo website:T www.CESifo-group.org/wpT ISSN 2364-1428CESifo Working Paper No. 5271 The Effects of Systemic Banking Crises in the Inter-War Period Abstract This paper examines the time-profile of the impact of systemic banking crises on GDP and industrial production using a panel of 24 countries over the inter-war period and compares this to the post-war experience of these countries. We show that banking crises have effects that induce medium-term adjustments on economies. Focusing on an eight-year horizon, it is clear that the negative effects of systemic banking crises last over the entirety of this time-horizon. The effect has been identified for GDP and industrial production. The adverse effect on the industrial sector stands out as being substantially larger in magnitude relative to the macroeconomic effect. Comparing the results across long-run historical periods for the same selection of countries and variables identifies some differences that stand out: the short term macroeconomic impact effects are much larger in the post-war period, suggesting that the propagation channels of shocks operate at a faster pace in the more recent period. Moreover, the time-profile of effects differs, suggesting that modern policies may be modulating the temporal shape of the response to banking crises shocks. However, the broad magnitude of the adverse effect of banking crises remains comparable across these time periods.JEL-Code: E600, N000, N200, G010.Keywords: local projections, banking crises, financial crises, economic history, inter-war. Bruno Rocha University of Cambridge IntroductionThis paper examines the time-profile of the impact of systemic banking crises on GDP and industrial production using a panel of 24 countries over the inter-war period and compares this to the post-war experience of these countries. The main aim of the paper is to clarify our understanding of the impact of banking crises during the inter-war period. The choice of countries is partly determined by historical data availability but we are able to study a diverse set of economies with differences in production structures, per capita income, and financial depth. Although there is significant general interest on the inter-war period in the literature on financial crises, partly because banking c...

No abstract

No abstract