Financial Markets and the Global Economy: the History of Bubbles, Crashes and Inflations

This course introduces students to the long run evolution of financial markets and to the history of monetary policy and financial crises.

The course covers the two waves of financial globalization of 1880-1914 and 1980-2008 and the de-globalization of finance that happened during the Great Depression. A long run perspective on the 2008 financial crisis and Eurozone crisis will be provided through several historical case studies of stock market crashes, banking panics, currency crises and sovereign defaults. Finally, the course explores how central banks responded to financial crises in different historical periods and covers the main evolutions in monetary policy over the last two hundred years.

The course puts strong emphasis on how institutional and political factors shape the process of financial globalization and on how the structure of the international monetary system affects the conduct of monetary policy and the response to financial crises.

Programme structure

- Stock market integration and stock market crashes before 1800
- The gold standard and financial globalization before WW1
- Banking panics under the classical gold standard and the monetary policy response
- WW1 financial instability, hyperinflation and the reconstruction of the gold standard in the 1920s
- Monetary policy and the Great Depression of the 1930s
- The 1929 stock market crash and 1931 global financial crisis
- Banking panics in the United States during the 1930s
- The evolution of monetary policy since WW2
- Financial crises in Latin America in 1980-2001
- The East Asian financial crisis of 1997/1998
- The 2008 subprime crisis in historical perspective
- The 2008-2012 Eurozone crisis in historical perspective

Course leader

Dr Olivier Accominotti, Dr Natacha Postel-Vinay, and Professor Albrecht Ritschl

Target group

Undergraduate and Graduate students

Course aim

This course is aimed at students willing to improve their understanding of money and financial markets through a historical approach. It is also highly relevant to financial market practitioners and policy makers interested in acquiring a long run perspective on current hot issues in money, banking, and finance.

Credits info

4 EC
Typical credit: 3-4 credits (US) 7.5 ECTS points (EU). You will need to check with your home institution. Assessment is optional.

Fee info

GBP 2500: Discounts apply when booking multiple courses. LSE Summer School runs three sessions during the summer, and students can book one course per session. Save 32% on your second course and 68% on your third course when booking.