In the second half of the 1970s, following the so-called ‘Carnation Revolution’ and when a global wave of privatisations started, the Portuguese government nationalised most of the companies listed on the Lisbon Exchange. A few years later the shareholders of nationalised companies were paid indemnities. The nationalisations radically changed the Portuguese corporate scene and led to very important wealth transfers. Contrary to what is usually assumed, we conclude that this transfer was detrimental to holders of large shareholdings, but favourable to small shareholders and, on average, akin to fair compensation based on market exchange.

This article examines the geo-economic consequences of the financial panic of October 1907. The vulnerability of the United States, but also of Germany, contrasted with the absence of a crisis in Great Britain. The experience showed the fast-growing industrial powers the desirability of mobilizing financial power, and the article examines the contributions of two influential brothers, Max and Paul Warburg, on different sides of the Atlantic. The discussion led to the establishment of a central bank in the United States and institutional improvements in German central banking: in both cases security as well as economic considerations played a substantial role.

This article reviews the political economy of Manchuria under the rule of Zhang Zuolin, which resulted in the economic instability that occurred during the winter of 1928. One can conjecture that the economic instability did not occur only because of the arbitrariness of the political and military regional government. The instability appears to be related to an ongoing seasonal demand for monies, which was relatively high between the months of September and March, since it corresponded to the period of commerce in soybeans − the region's main economic activity −, the migration of seasonal workers, and also the festive period of the Chinese New Year. The analysis was conducted based on primary materials published by the South Manchuria Railway Company, such as currency issuance and the variation of the exchange rate of the major currencies in circulation among foreign and Chinese currencies.

This article explores the financing of early industrial corporations using newly constructed panel data from Imperial Russian balance sheets. We document how corporate capital structures and dividend payout policies reflected internal agency issues, information asymmetries with external investors, life cycle considerations, and other frictions present in the Russian context. In particular, we find that widely held, listed and more profitable corporations were less reliant on debt financing. Asset tangibility was associated with lower debt levels, suggesting that Russian corporate debt was short-term, collateral was largely irrelevant, or agency problems dominated. Finally, we find that many of these same issues, for example ownership structure and access to securities markets, also mattered for financial performance and that dividends may have compensated investors for poor legal protections.

Joseph Brennan, as secretary of the Irish Department of Finance (1923–7) and chair of the Irish Currency Commission (1927–43), was a pivotal influence on Irish banking and currency affairs. Yet, within the existing literature, his adherence to conservative British norms is seen as providing a ‘bleak prescription’ for the Irish economy. However, such a view ignores the fact that Brennan was far from dogmatic on banking and currency issues and underplays his incrementalist, and often internationalist, approach to the development of Irish monetary institutions. Brennan's actions up to the early 1940s were based on the realities of Ireland's slowly receding economic and intellectual dependency on Britain, a ‘dependency’ often misrepresented in the existing literature as a more primitive, pre-Keynesian, conservative approach. However, rather than acting as a restraining influence on Irish economic development, the policies Brennan advocated enabled Ireland to avoid the instability associated with many smaller, emerging nation states in the 1920s and 1930s. The focus on continuity – which guaranteed currency and banking stability – represented the realities of Ireland's reliance on the sluggish British economy in the decades after independence. Brennan's achievement, in helping to sustain banking and currency stability notwithstanding economic uncertainty, a fragile political environment (and suspicious banking interests), deserves wider acknowledgement.

We employ a panel data research design to examine the determinants of investment returns in the Swedish property fire insurance industry from 1903 to 1939 – a period of great economic and political uncertainty. Contrary to expectations, we find that mutual fire insurers generated systematically higher investment returns than stock fire insurers. Investment returns are inversely related to leverage but positively related to liquidity, showing that firms adopting a more precautionary investment strategy attain higher returns.

This bibliography covers publications that appeared during 2005 and 2004 when they were not known before the deadline of last year's bibliography. In that case the year of publication is mentioned in the citation.

Based on the reconstruction of the monetary flows of a merchant-banking company operating in Barcelona at the beginning of the fifteenth century, this study aims to understand the reasons behind exchange-rate variations in the local currency with respect to the principal European markets, as well as the modalities and predictability of such oscillations. By using real rather than ‘hearsay’ rates, we present new assessments of the seasonal character of exchange rates and their sensitivity to conditions of currency abundance or shortage. In addition, econometric analysis shows that exchange-rate volatility was quite modest and dependent on geographic and macroeconomic factors, such as the system of commercial flows.

This article discusses historical evidence from the Potosi mint and Massachusetts Bay mint that illustrates the importance of the resource endowment (in this case silver) for the provision of small change. We show that the availability of silver was fundamental in shaping incentives. The relative scarcity of silver in Massachusetts Bay contributed to the small scale of the mint's operations, and implied that neither the monetary authority nor the mintmaster faced a significant tradeoff between drawing seigniorage from the mint and the production of small-denomination coins. In contrast, in the Viceroyalty of Peru, the abundance of silver, and the consequent large level of production of the mint's heavy peso coin, heightened the tradeoff between the fiscal and monetary objectives of the coinage. We suggest that these incentives negatively affected the production of fractionary coinage in the Peruvian viceroyalty, whereas in Massachusetts Bay the production of small-denomination coins was the norm.

This article discusses the dividend strategy adopted by Norwegian commercial banks before 1914. Based on a unique data set covering all banks in the period 1882– 1913 as well as six other institutions for the pre-1882 period, I identify the existence of a strong bias towards the payment of high and stable dividends to shareholders. The origins of such bias lie in the specific institutional set-up of commercial banking, the expectations of shareholders and the absence of developed securities markets. Combined with a strong preference for high gearing, this feature contributed to increase the fragility of the Norwegian banking system.

This article explores long-term trends in risks and returns within central banking using Danmarks Nationalbank as a case study. Core earnings generated by the basic functions and the associated risks typical of a central bank accounted on average for most of the Nationalbank's financial returns over the past 175 years. For a long period, this was the result of a passive risk-management strategy under which financial risks and returns just reflected the various functions performed by the Nationalbank and not the outcome of a deliberate decision-making process. A formalised and holistic risk-management framework was introduced only in the 1990s.

This article traces the origins of the ‘national bank’ in the Gold Coast. It shows how the Colonial authorities perverted the demand by Africans for a special kind of bank to aid their development. The Colonial Office preferred and ensured the establishment of an orthodox institution, which had little to give with regard to Africans' demand for developmental credit. This was because it believed that such development institutions would be unhelpful to, arguably, uncreditworthy Africans. This attitude, it is argued, represented a setback to the Gold Coast's development. Either such an institution, as demanded by Africans, would have helped the colony's advance, or Africans would have learnt earlier that the concept of development was more fundamental than setting up a ‘national bank’.

This article uses the leading firms of the German chemical industry as a case study to provide a detailed example of how companies in the late nineteenth and early twentieth century used internal financing as an instrument of corporate finance. It traces the at first diverse significance of internal financing for the industry and identifies two moments of market concentration that triggered a convergence of corporate finance by a harmonisation of accounting standards that were not predefined by legal frameworks. The article argues that secret reserves and further ways of internal financing were key components of this harmonisation. The industry-wide creation of secret reserves cloaked the companies’ actual financial strength from outsiders who were merely left with an image of the respective firms that was carefully drafted by companies’ managers.