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Intensified Regulatory Scrutiny and Bank Distress in New York City During the Great Depression

Published online by Cambridge University Press:  01 June 2009

Gary Richardson  and
Patrick Van Horn
Gary Richardson*
Affiliation:
Associate Professor, Department of Economics, 3151 Social Science Plaza, University of California, Irvine, CA 92697-5100 and NBER. E-mail: [email protected].
Patrick Van Horn*
Affiliation:
Assistant Professor, Department of Economics, 4901 Evergreen Road, University of Michigan, Dearborn, MI 48128. E-mail: [email protected].
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Abstract

Bank distress peaked in New York City, at the center of the United States money market, in July and August 1931, when the banking crisis peaked in Germany and before Britain abandoned the gold standard. This article tests competing theories about the causes of New York's banking crisis. The cause appears to have been intensified regulatory scrutiny, which was a delayed reaction to the failure of the Bank of United States, rather than the exposure of money center banks to events overseas.

Type
ARTICLES
Information
The Journal of Economic History , Volume 69 , Issue 2 , June 2009 , pp. 446 - 465
Copyright
Copyright © The Economic History Association 2009

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