History of Financial Crises

Catalog description

Financial crises are as old as financial markets themselves. There are many similarities between historical events. More often than not, financial crises are the result of bubbles in certain asset classes or can be linked to a specific form of financial innovation. This course gives an overview of the history of financial crises. We go back almost 400 years and start with the Tulip mania of 1636. From there we will slowly make our way back to today, encountering many crisis episodes that are relevant from today’s point of view. The course is organized around two themes: 1. Asset prices bubbles: 2. Credit, banks and the amplification of shocks through the financial system. We will see that these are recurring themes in the history of financial crises. The purpose of this course is to understand the causes of past crises and to develop a conceptual framework that ties common elements together. We will discuss the lessons that we can draw for financial markets today.