Foreign capital, financial crises and incomes in the first era of globalization

Michael D. Bordo, Christopher M. Meissner

Research output: Contribution to journalArticlepeer-review

5 Scopus citations


We explore the association between income and international capital flows between 1880 and 1913. Capital inflows are associated with higher incomes per capita in the long run, but capital flows also brought incomes down in the short run via financial crises. Countries just barely made up for these losses over time, so that there is no conditional long-run income loss or gain for countries that experienced crises. This is in contrast to the recent wave of globalization when capital importing countries that experienced a crisis seemed to grow relatively faster over fixed periods of time. Some countries avoided crises and were able to raise incomes with foreign capital. We discuss some possibilities why.

Original languageEnglish (US)
Pages (from-to)61-91
Number of pages31
JournalEuropean Review of Economic History
Issue number1
StatePublished - Apr 2011

All Science Journal Classification (ASJC) codes

  • History
  • Economics, Econometrics and Finance (miscellaneous)


Dive into the research topics of 'Foreign capital, financial crises and incomes in the first era of globalization'. Together they form a unique fingerprint.

Cite this