This article scrutinizes the results of the mission carried out by Edwin Walter Kemmerer in Mexico during 1917. Based on unpublished materials from his private archive, as well as other Mexican archives, this article analyses the process of approval, installation and implementation of the reforms introduced by Kemmerer's mission in Mexico. It is argued that Kemmerer's work as a financial advisor for Venustiano Carranza was not a total failure, as the existing literature on the subject claims. Indeed, on the eve of Great Depression, Mexico exhibited the main institutional features of ‘Kemmererized’ countries: a central bank, the gold standard and a centralized tax system. It is also suggested that the economic knowledge brought into the country by the money doctor moulded the ideological foundation of the new financial and economic elite of revolutionary Mexico.

This article considers the changing regulatory environment in which French insurance operated between the ancien régime and the post-war years. At first treated with suspicion, the state came to recognise the social benefits of insurance during the industrial revolution. The extension of regulation over different products and companies – life, marine, general – needs to be understood as a historical process in which first the benefits and then the possibilities for access to substantial financial resources came to be understood. A dual tradition of mistrust and fascination has prevailed in the French attitudes towards insurance, and this paper explores this relationship in a variety of contexts. It is suggested that the eventual nationalisation of much of the industry in 1946 was a signal of both increasing respectability and of the state's desire to offer universal coverage. The opportunity to mobilise and direct investment flows was also attractive.

This article examines the impact of organizational structure on risk taking across different lines of property insurance (fire, marine, vehicle and specialized property insurance) in Sweden from 1913 to 1939. Based on the theoretical arguments whereby the mutual organizational form has a competitive advantage in underwriting homogeneous but unknown risk distribution, while the stock organizational form is more likely to underwrite more volatile and heterogeneous risk categories, we conclude that organizational form has a significant impact on risk taking. Our empirical analysis shows that the risk taking, measured as incurred claims to anticipated losses, was on average lower among mutual insurers. When comparing across lines of insurance, the analysis shows that the mutual form was more successful in keeping down risks in fire and marine, while less so in vehicle and specialized property insurance. Stock companies mitigated the higher risk by ceding more premiums to reinsurers and by diversifying more across different lines of insurance.

While the International Debt Crisis of the early 1980s was the most severe financial crisis since World War II and while national and international banking supervision was developing at that time, little is known about the response of supervisors to the deteriorating financial environment in the years preceding the crisis. Complementing the political and business history of the international debt situation, this article aims to unravel the international banking supervision side of the question. Based on archival material from the Bank for International Settlements (BIS) and various central banks, the article examines how the Basel Committee on Banking Supervision (BCBS), then emerging as the leading forum on international banking supervision, anticipated the International Debt Crisis through the prism of ‘country risk’. The article shows that the Committee refused to recommend strict regulations in this area. It argues that members adopted this position because of the lack of good information and the difficult position of banking supervision between macroeconomic issues and individual banks’ own responsibilities, but also because of somewhat excessive faith in market mechanisms. Their discussions on country risk shed light on critical challenges of banking supervision and, thereby, on the history of banking regulation and prudential thinking.

This article documents and analyses monetary reform in Bulgaria, Greece, Serbia and Romania from 1815 (Serbian autonomy within the Ottoman Empire) to 1910, when Greece became the last country in the region to join the gold standard. It explains the five key steps towards monetary reform which the four countries took in the same chronological order, and asks why national coinage and the foundation of a bank of note issue came late in the reform process. The South-East European countries tried to emulate West European prototypes, yet economic backwardness meant such institutions were often different from the outset, remained short-lived or both.

Financial historians have devoted considerable attention to the investment behaviour of urban politicians in the market for public debt in the Low Countries. They have focused not only on how many urban officials invested in annuities, but also why they did so. On the one hand, it has been suggested that political elites often had political and economic motivations for investing in urban annuities. By contrast, historians from the institutional school defend the thesis that inclusive governance led to broader participation in the market for urban credit. A variable that has gone largely unnoticed in explaining investments by the political elite is the impact of the changing composition and social profile of the ruling elites on their investment behaviour. In this article, I examine the case of sixteenth-century Ghent to argue that changes in the city's power structure resulted in profound changes in attitudes towards public debt management. While the old political elite in the early sixteenth century prioritised selling annuities to individuals who belonged to the political networks of their time, the group of political newcomers that dominated urban politics at the end of the sixteenth century had much more of a market-oriented attitude, giving priority to non-political investors in the free market.

Numerous handloom weavers' cottages in Lancashire were constructed by terminating building societies. Given their numbers, it is evident that the role of such societies in the regional socio-economic context has been understated. Identifying their membership reveals that these were not self-help schemes to enable artisans to own their own homes, but rather that they offered opportunities for those with surplus income to invest in tenanted properties at a time when the skills of the handloom weaver were at a premium. This provision was vital to Lancashire's burgeoning economy, and offered subscribers an additional source of income.

As a result of legislation in 1855, 1856 and 1862 that effectively enabled limited liability companies to be formed with minimum difficulty for the first time, there was an explosion of new companies. However, after the collapse of Overend, Gurney Ltd in 1866 they became unpopular. This paper examines the case of a business which failed to raise the necessary funding because of suspicion of exaggerated claims made in public prospectuses and the ways in which it attempted to survive. This gypsum industry case history also illustrates the problems facing the new class of ‘pure’ investors and directors who had little understanding of the industry in which their company was operating and the nature and reliability of the financial information available to them required for their decision-making.

The considerable renewal of interest in all aspects of financial history over recent years provided one motivation for this new venture. Yet, the foundations for our specialism, which draws from both History and the Social Sciences, especially economics, have been laid by many. Some would point to continuity in our interest from the publication in the 1930s of jubilee banking history volumes, such as those written for British institutions by Gregory, and by Crick and Wadsworth. Further scholarly momentum came from the studies in comparative banking history undertaken by researchers inspired and brought together by Rondo Cameron from the mid-1960s. Upon these footings and others, financial history has since ‘taken off’ to address an increasingly wider range of issues. This considerable broadening of the specialism, ironically, almost coincided with the decline and then the eventual demise in 1987 of the Revue Internationale d'Histoire de la Banque, founded in 1968. This is not the place to draw up a balance sheet of that journal, which has played a decisive role. Its demise, however, left a gap. Financial History Review aims not only to take up its cause, but also to widen the scope of publishing in the field – from banking to financial history – in order to offer the fullest possible support for continuing research.

From 1716 to 1718, Sweden experienced a shock of liquidity when the absolutist regime of Charles XII issued large amounts of fiat coins (mynttecken) in order to finance the Great Northern War. After the death of the king in November 1718, the new parliamentary regime decided to partially default on the coins. In international literature, this episode is largely unknown, and in Swedish historiography, scholars have often claimed that the country's currency collapsed in hyperinflation. We assess the performance of the new coins by studying how prices of commodities in various geographic locations developed. We also study bookkeeping practices in order to see how accountants treated the new coins. Our results show that there was a complex relationship between prices and liquidity. Prices of products in high demand by the military increased more than other prices. Accountants did not treat mynttecken and other currencies differently in 1718. It was only after the death of the king that accountants started to differentiate between different types of coins. The value of the fiat coins was linked to the actions and the legitimacy of the royal regime, which is in line with the State theory of money.

A previously unknown pricing anomaly existed for a few years in the late 1840s in the British government bond market, in which the larger and more liquid of two very large bonds was underpriced. None of the published mechanisms explains this phenomenon. It may be related to another pricing anomaly that existed for much of the nineteenth century in which terminable annuities were significantly underpriced relative to so-called ‘perpetual’ annuities that dominated the government bond market. The reasons for these mispricings seem to lie in the early Victorian culture, since the basic economic incentives as well as laws and institutions were essentially the familiar modern ones. This provides new perspectives on the origins and nature of modern corporate capitalism.

By examining the acts of the Public Notary of Haifa (1890–1915), this article shows that it was the traditional informal market of credit, run by local notables, which financially supported the development of the small-landholding-based agricultural sector of the Haifa district in late Ottoman Palestine. In seeking to ascertain what led to the success of the informal rural credit market as compared with the formal credit market, the article finds that the local notables, who acted as financial intermediaries for small landholders, enjoyed an information advantage over the banks stemming from the establishment of interlinked credit market transactions connected to the stipulation of bay' wafā, salam and muzara‘ah contracts. In a context of land privatisation and growing commercialisation of agriculture, these contracts became the instruments used by notables to invest in peasants' landholdings and to manage a sales network for agricultural products on a local and international scale, hence representing an efficient financial institution to support the ‘agricultural export-led growth’ of late Ottoman Palestine.

This article traces the origin of too-big-to-fail policy in modern US banking to the bailout of the $1.2b Bank of the Commonwealth in 1972. It describes this bailout and those of subsequent banks through that of Continental Illinois in 1984. During this period, market concentration due to interstate banking restrictions is a factor in most of the bailouts and systemic risk concerns were raised to justify the bailouts of surprisingly small banks. Finally, most of the bailouts in this period relied on the Federal Deposit Insurance Corporation's use of the Essentiality Doctrine and Federal Reserve lending. A discussion of this doctrine is used to illustrate how legal constraints on regulators may become less constraining over time.

The shortcomings and potential dangers of international financial flows for the health and stability of domestic banking systems in developing countries have been copiously discussed over the last decades. While the importance of capital controls and regulation as determining factors has been widely emphasised, the extent to which these policies work in episodes of financial crisis is still a matter of debate. This article examines the relationship between supervisory frameworks and banking fragility in Mexico and Brazil in the wake of the international debt crisis of 1982. It shows that the model of international banking intermediation that evolved out of the stringent capital mobility system in Brazil was considerably less vulnerable to crisis than in Mexico, which had a more lightly regulated regime. These findings provide insights into historical debates about the implications of prudential regulation and capital controls for the development and expansion of foreign finance, and whether the risks underlying international banking are necessarily inherent in the process of financial globalisation.

How could a primitive credit market finance the early industrialisation of an underdeveloped economy? To answer this question, we use a hand-collected data set of mortgage loans raised by industrial firms in the city of São Paulo during the period 1866-1914. These mortgages were debt obligations collateralised by land, improvements, machinery and equipment. We argue that the mortgage credit market was a key source of funding for early industrial investments in Brazil. We find that industries were mainly funded by non-banking and domestic agents. The empirical evidence suggests that mortgages were an important proxy for industrial investment.

We identify the timing of currency, banking crises and sudden stops in New Zealand from 1880 to 2008 using methodologies from the international literature and consider the extent to which the empirical models in that literature can explain New Zealand's crisis history. We find that the cross-country evidence on the determinants of crises fits New Zealand experience reasonably well. A number of the risk factors that correlate with crises internationally – such as domestic imbalances, external debt, and currency mismatches – were elevated for New Zealand when the country had more frequent crises and have improved in the recent (more stable) period. However, a time-series analysis of New Zealand growth over 120 years shows that global factors – such as the US growth rate and terms of trade – explain New Zealand growth fairly well, and that crisis-dummy variables do not have substantial additional explanatory power. This suggests that having sound institutions and policies may help avoid severe domestic crises, but will not be sufficient to avoid the domestic economic impact of the global business cycle.

From the 1970s to the 1990s there was a revolution in international financial markets, which combined the processes of financialisation and globalisation. Deregulation and financial innovation were the two underlying forces that facilitated this transformation. At the same time, distinctive national characteristics of banking structures and cultures influenced the way that financial globalisation affected the geographic distribution of financial activity. This article addresses these seismic shifts through three perspectives: changes in regulation and the geographic pattern of international banking activity, reform of the main stock markets in New York and London and the rise of financial conglomerates. It identifies complementarity as well as competition among international financial centres.