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This Time is Different: A Panoramic View of Eight Centuries of Financial Crises*
Carmen M. Reinhart, University of Maryland and NBER Kenneth S. Rogoff, Harvard University and NBER
This paper offers a “panoramic” analysis of the history of financial crises dating from England’s fourteenth-century default to the current United States sub-prime financial crisis. Our study is based on a new dataset that spans all regions. It incorporates a number of important credit episodes seldom covered in the literature, including for example, defaults and restructurings in India and China. As the first paper employing this data, our aim is to illustrate some of the broad insights that can be gleaned from such a sweeping historical database. We find that serial default is a nearly universal phenomenon as countries struggle to transform themselves from emerging markets to advanced economies. Major default episodes are typically spaced some years (or decades) apart, creating an illusion that “this time is different” among policymakers and investors. A recent example of the “this time is different” syndrome is the false belief that domestic debt is a novel feature of the modern financial landscape. We also confirm that crises frequently emanate from the financial centers with transmission through interest rate shocks and commodity price collapses. Thus, the recent US sub-prime financial crisis is hardly unique. Our data also documents other crises that often accompany default: including inflation, exchange rate crashes, banking crises, and currency debasements. JEL E6, F3, and N0
The authors are grateful to Vincent Reinhart, John Singleton, Arvind Subramanian, and seminar participants at Columbia and Harvard Universities for useful comments and suggestions and Ethan Ilzetzki, Fernando Im, and Vania Stavrakeva for excellent research assistance.
I. Introduction The economics profession has an unfortunate tendency to view recent experience in the narrow window provided by standard datasets. With a few notable exceptions, crosscountry empirical studies on financial crises typically begin in 1980 and are limited in several other important respects.1 Yet an event that is rare in a three decade span may not be all that rare when placed in a broader context. This paper introduces a comprehensive new historical database for studying international debt and banking crises, inflation, currency crashes and debasements. The data covers sixty-six countries in Africa, Asia, Europe, Latin America, North America, and Oceania. The range of variables encompasses, among many other dimensions, external and domestic debt, trade, GNP, inflation, exchange rates, interest rates, and commodity prices. The coverage spans eight centuries, generally going back to the date of independence for most countries, and well into the colonial period for some. As we detail in an annotated appendix, the construction of our dataset has built heavily on the work of earlier scholars. However, it also includes a considerable amount of new material from diverse primary and secondary sources. In addition to a systematic dating of external debt and exchange rate crises, the appendix to this paper also catalogues dates for domestic inflation and banking crises. For the dating of sovereign defaults on domestic (mostly local currency) debt, see Reinhart and Rogoff (2008). The paper is organized as follows. Section II summarizes highlights from a first view of the extended dataset, with special reference to the current conjuncture. Among other things, we note that policymakers should not be overly cheered by the absence of major external defaults from 2003 to 2007, after the wave of defaults in the preceding two
Among many important previous studies include work by Bordo, Eichengreen, Lindert, Morton and Taylor.
decades. Serial default remains the norm, with international waves of defaults typically separated by many years, if not decades. Many foreign investors and policymakers today seem lulled by the fact that many emerging market governments have become less reliant on foreign currency external borrowing than in the recent past. Countries have instead been relying more on domestic currency debt issued in local markets. Yet, as we show in a companion paper, reliance on domestic debt is hardly new, and the view that domestic debt can be largely ignored in looking at external debt sustainability is hard to reconcile with the extensive historical experience.2 Our dataset reveals that the phenomenon of serial default is a universal rite of passage through history for nearly all countries as they pass through the emerging market state of development. This includes not only Latin America, but Asia, the Middle East and Europe. We also find that high inflation, currency crashes, and debasements often go handin-hand with default. Last, but not least, we find that historically, significant waves of increased capital mobility are often followed by a string of domestic banking crises. Section III of the paper gives a brief overview of the sample and data. Section IV catalogues the history of serial default on external debts, from England’s defaults in the Middle Ages, to Spain’s thirteen defaults from the 1500s on, to twentieth-century defaults in Asia, Africa, and Latin America. Our database marks the years that default episodes are resolved as well as when they began, allowing us to look at the duration of default in addition to the frequency. Section V of the paper looks at the effect of global factors on sovereign default, including commodity prices and capital flows emanating from the center countries. We
These issues are analyzed in detail in Reinhart and Rogoff (2008).
3 .” In the concluding section.. one fact that jumps out from the figure are the long periods where a high percentage of all countries are in a state of default or restructuring. Aside from the current lull. a government default on its own external debt or private sector debts that were publicly guaranteed. First Insights: The Big Picture What are some basic insights one gains from this panoramic view of the history of financial crises? We begin by discussing sovereign default on external debt (i. II.) The first observation is that for the world as a whole (or at least the more than 90 percent of global GDP represented by our dataset). In this respect. Figure 1 plots for the years 1800 to 2006 (where our dataset is most complete). Will the early 21st century prove different? Appendix A gives a brief synopsis of how the database was constructed. the current period can be seen as a typical lull that follows large global financial crises. while Appendices I (macroeconomic series) and II (debt) list all the variables in the database and provide their sources on a period-by-period and country-by-country basis. there are five pronounced peaks or default cycles in the figure.e. the 2007–2008 US sub-prime financial crisis is hardly exceptional. Section VI shows that episodes of high inflation and currency debasement are just as much a universal right of passage as serial default. we take up the issue of how countries can graduate from the perennial problem of serial default.show how shocks emanating from the center countries can lead to financial crises worldwide. Indeed. the percentage of all independent countries in a state of default or restructuring during any given year. Section VII introduces a composite index that aggregates the “varieties of crises.
The third episode begins in the early 1870s and lasts for two decades. nearly half the countries in the world were in default (including all of Latin America). out of a total of sixty six listed in Table 1. the current lull stands out even more against the preceding century. Only the two decades before World War I—the halcyon days of the gold standard—exhibited tranquility Kindleberger (1988) is among the few scholars who emphasize that the 1950s can be viewed as a financial crisis era. and Standard and Poor’s (various years). Notes: Sample size includes all countries. Rogoff. Suter (1992). Purcell and Kaufman (1993). Reinhart. that were independent states in the given year. Figure 1 Sovereign External Debt: 1800-2006 Percent of Countries in Default or Restructuring 60 50 40 Percent of countries 30 20 10 0 1800 1810 1820 1830 1840 1850 1860 1870 1880 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 Year Sources: Lindert and Morton (1989).The first is during the Napoleonic War. when. at times. Macdonald (2003). The fourth episode begins in the Great Depression of the 1930s and extends through the early 1950s. when again nearly half of all countries stood in default. The second runs from the 1820s through the late 1840s.3 The most recent default cycle encompasses the emerging market debt crises of the 1980s and 1990s. as in Figure 2 below. when one weights countries by their share of global GDP. 3 4 . Indeed. and Savastano (2003).
4 5 . This is partly a result of new defaults produced by the war. only the peak of the 1980s debt crisis nears the levels of the early 1800’s. the poorest countries in Africa and South Asia receive the same weight as Brazil or the United States). even including Asia and Europe. 5 Kindleberger (1989) emphasizes the prevalence of default after World War II. As we shall see when we tabulate individual country experiences in Section IV. On an unweighted basis (so. once cannot fail to note that whereas one and two decade lulls in defaults are not at all uncommon. for example. Outside World War II. but also due to the fact that many countries never emerged from the defaults surrounding the Great Depression of the 1930s.5 By the same token. serial default on external debt—that is. though he does not provide quantification. This comparison weights defaulting countries by share of world income. with countries representing almost 40 percent of global GDP in a state of default or rescheduling. each lull has invariably been followed by a new wave of default.anywhere close to that of the 2003-to-2007 period. repeated sovereign default—is the norm throughout every region in the world. the late 1960s until 1982 had an even lower percentage of independent countries in default. Figure 2 is interesting because it shows the years after World War II as marking the peak of by far the largest default era in modern world history.4 Looking forward. the Napoleonic War defaults become as important as any other period.
peaks and troughs in commodity price cycles appear to be leading indicators of peaks and troughs in the capital flow cycle. that were independent states in the given year. play a major role in precipitating sovereign debt crises. Making use of a range of real global commodity price indices. Our extensive new dataset also confirms the prevailing view among economists that global economic factors. 1913 weights for the period 1800–1913. Macdonald (2003). Three sets of GDP weights are used. Sussman and Yafeh (2006).Figure 2 Sovereign External Debt: 1800-2006 Countries in Default Weighted by Their Share of World Income 45 40 35 All countries in sample Percent of world Income 30 25 20 15 Excluding China 10 5 0 Sources: Lindert and Morton (1989). 6 See Bulow and Rogoff (1990). and Standard and Poor’s (various years). Rogoff. including commodity prices and center country interest rates. 18 00 18 07 18 14 18 21 18 28 18 35 18 42 18 49 18 56 18 63 18 70 18 77 18 84 18 91 18 98 19 05 19 12 19 19 19 26 19 33 19 40 19 47 19 54 19 61 19 68 19 75 19 82 19 89 19 96 20 03 Ye ar We have already seen from Figure 2 that global conflagration can be a huge factor 6 . Suter (1992). and finally 2003 weights for the period 1991–2006. and Savastano (2003). out of a total of sixty six listed in Table 1. with troughs typically resulting in multiple defaults.6 We take up this issue in Section V. Reinhart. Notes: Sample size includes all countries. Maddison (2003). 1990 for the period 1914–1990. in generating waves of defaults. and Mauro. we show that over the period 1800 to 2006. Purcell and Kaufman (1993).
we employ our favored index of capital mobility.An even stronger regularity found in the literature on modern financial crises (e. the two earliest ones we clock in emerging markets are India. as illustrated in Figure 3. with surges in capital inflows often preceding external debt crises at the country. (2001)—but for the earlier period we had to resort to archeological work. to cover our full sample period. our dating of crises extends back to far before the much-studied modern post– World War II era. (See Table A. The preliminary evidence here suggests the same to be true over a much broader sweep of history.3 for details. regional. specifically we start in 1800. What separates this study from previous efforts (that we are aware of) is that for so many countries. and global level since 1800 if not before. due to Obstfeld and Taylor (2003). but historically. updated and backcast using their same design principle. 1999 and Reinhart and Rogoff. Periods of high international capital mobility have repeatedly produced international banking crises..) Our work was greatly simplified back to 1880 by the careful study of Bordo. Kaminsky and Reinhart. 7 . While the Obstfeld–Taylor index may have its limitations. Also consonant with the modern theory of crises is the striking correlation between freer capital mobility and the incidence of banking crises. On the left scale.g. The earliest advanced economy banking crisis in our sample is Denmark in 1813. we feel it nevertheless provides a concise summary of complicated forces by emphasizing de facto capital mobility based on actual flows. The dating of banking crises episodes is discussed in detail in the Appendix. et al. 2008b) is that countries experiencing sudden large capital inflows are at a high risk of having a debt crisis. The figure plots a three-year moving average of the share of all countries experiencing banking crises on the right scale. not only famously as they did in the 1990s. 1863 and Peru 10 years later.
6 Index 0. Kaminsky and Reinhart (1999). and held by foreign residents. 7 Percent 8 . Notes: As with external debt crises. out of a total of sixty six listed in Table 1 that were independent states in the given year. domestically issued debt was in local currency and held principally by local residents. was typically in foreign currency. Indeed. sample size includes all countries. but a concise summary of complicated forces. 18002007 1914 High 1 0. over most of the time period considered. External debt.2 Share of Countries in Banking Crisis. admittedly arbitrary. it has been ignored in the empirical studies on debt and inflation in developing countries. we updated our favorite index of capital mobility. (The aforementioned Peruvian case comes from a little-known 1957 book published in Lima by Carlos Camprubi Alcazar entitled Historia de los Bancos en el Peru. our database includes long time series on domestic public debt.) As noted. and these authors. many generally knowledgeable observers have argued that the recent shift by many emerging market For most emerging market economies.7 Because historical data on domestic debt is so difficult to come by.9 0. Caprio et al. Obstfeld and Taylor (2004). On the right scale. The smooth red line shows the judgmental index of the extent of capital mobility given by Obstfeld and Taylor (2003).1 Low 0 1800 1810 1820 1830 1840 1850 1860 1870 1880 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 1918 5 0 Sources: Bordo et al. backcast from 1800 to 1859 using their same design principle. on the other hand. (2005). 3-year Sum (right scale) 35 30 25 20 Capital Mobility (left scale) 1825 15 1860 1980 10 1945 0.7 0.8 0.3 0.4 0.Figure 3 Capital Mobility and the Incidence of Banking Crisis: All Countries. There are many more such case studies in our references that were a vital source of information on banking crises.5 0. 1860–1879. (2001).
Reinhart. cross-country historical time series on domestically issued debt are also absent from private data collections. put together an annual series going back to 1990 for a limited number of emerging market countries. Until very recently. contrary to the received wisdom.9 The topic of domestic debt is so important.governments from external to domestic bond issues is revolutionary and unprecedented. In fact. the domestic debt share is typically over 30 percent and has been at times over 50 percent. Neither the International Monetary Fund nor the World Bank systematically collected such data. we focus on a few major points. including emerging markets. Jeanne and Guscina (2008) have extended them both back to 1980 and up to 2005.) Even for Latin America. Figure 4 plots domestic debt as a share of total public debt over 1900 to 2006. domestic debt was not on the radar screen of the multilateral institutions. domestic debt constituted an important part of government debt in most countries. many private investment-bank reports also trumpet the rise of domestic debt as a harbinger of stability. Furthermore. nothing could be further from the truth. domestically issued debt averages more than 50 percent of total debt for most of the period. 2008). The first is that contrary to much contemporary opinion. Here. 8 9 . over most of their existence. (This figure is an unweighted average of the individual country ratios. April 2007. that we have broken out our data analysis into an independent companion piece (Reinhart and Rogoff. Rogoff and Savastano (2003). with extensive help from IMF staff and country sources. 9 Since then. For our entire sample of sixty-six countries.8 As we shall argue. and the implications for existing empirical studies on inflation and external default are so profound. this data reveal that a very important share of domestic debt—even in emerging markets— was long-term maturity See the IMF Global Financial Stability Report. with implications for today’s markets and for historical analyses of debt and inflation.
the implication is that the extent of domestic debt can be quite important in assessing the sustainability of a country’s external debt payments.00 1900 1905 1910 1915 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 of which North America All countries of which Latin America Sources: The League of Nations. As payments on domestic debt must come from the same revenue stream as payments on foreign debt. we also present a variety of evidence to support the view that.50 0.70 0. Yet. at the very least.10 0. most of the empirical literature since Cagan’s classic (1956) paper has focused on the “seignorage” gains from inflation. Yet.30 0. In that paper.90 0. Figure 5 on inflation and external 10 . domestic debt does not appear to be junior to external debt. the United Nations. Reinhart and Rogoff find that the same issue arises in the analysis of high inflation.20 0. and others sources listed in Appendix II. most empirical researchers have ignored the issue entirely.00 0.60 Share 0. because it has not been possible to obtain extensive historical time series on domestic debt until now. which are entirely levered off the real money base. the government’s gain to unexpected inflation often derives at least as much from capital losses that are inflicted on holders of long-term government bonds.40 0.Figure 4 Domestic Public Debt as a Share of Total Debt. (Reinhart and Rogoff 2008a). 1900-2006 1.80 0. even factoring in a government’s ability to default via inflation.
most investment banks. for high inflation episodes. Since World War II. Figure 5 Inflation and External Default: 1900-2006 50 45 40 35 Share of countries in default Correlations: 1900-2006 0. inflation and default have gone hand-in-hand. Notes: Both the inflation and default probabilities are simple unweighted averages. see Appendix I. the risk of default on external debt has dropped dramatically.39 excluding the Great Depression 0. As we have already noted. This conclusion seems to be built on the faulty premise that countries will treat domestic debt as junior. especially as the share of external debt has fallen.75 Percent of countries 30 25 20 15 10 5 0 1900 1904 1908 1912 1916 1920 1924 1928 1932 1936 1940 1944 1948 1952 1956 1960 1964 1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 Share of countries with inflation above 20 percent Ye ar Sources: For share of countries in default. bullying domestics into accepting lower repayments or simply 11 . not to mention official bodies such as the International Monetary Fund and the World Bank.default (1900–2006) illustrates the striking correlation between the share of countries in default on debt at one point and the number of countries experiencing high inflation (which we define to be inflation over 20 percent per annum). have argued that even though total public debt remains quite high today (early 2008) in many emerging markets. see Figure 1. The forgotten history of domestic debt has important lessons for the present.60 1940-2006 0.
they are deeply mistaken. suggests that a high ratio of domestic to external debt in overall public debt is cold comfort to external debt holders. Another noteworthy insight from the “panoramic view” is than that the median duration of default spells in the post–World War II period is one-half the length of what it was during 1800–1945 (3 years versus 6 years. Newfoundland lost nothing less than her sovereignty when it defaulted on its external debts in 1936 and ultimately became a Canadian province. Once debt is restructured. 12 .4. The sums were so minor that the event did not draw great attention in the Western press. as Bordo and Eichengreen (2001) observe. The explanation. Default probabilities probably depend much more on the overall level of debt. many investors appear to be justifying still relatively low external debt credit spreads because “This time is different” and emerging market governments are now relying more on domestic public debt. Egypt. among others. To summarize. The historical record. when bail-outs are facilitated by the likes of the International Monetary Fund.defaulting via inflation. The charitable interpretation of this fact is that crisis resolution mechanisms have improved since the bygone days of gun-boat diplomacy. however. who in 1958 rescheduled its foreign debts when it stood at only1/4 percent of revenues. The fact remains that. is that India at this time had a significant claim on revenue from the service of domestic debt (in effect the total debt-to revenue ratio was 4. After all. A more cynical explanation points to the possibility that. creditors are willing to cut more slack to their serial-defaulting clients. If so. the number of years separating default episodes in the more recent period is much lower. as it turns out. as shown in Figure 6). became British “protectorates” following their defaults. Reinhart and Rogoff (2008b) discuss the interesting example of India.
Importantly. and Savastano (2003). Rogoff. percent 20 15 10 5 0 1 4 1946-2006 169 episodes Median is 3 years 1800-1945 127 episodes Median is 6 years 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52 55 58 61 64 67 70 Years in Default Sources: Lindert and Morton (1989). III. we include a large number or Asian and African economies. be it through restructuring. or debt forgiveness. Extensive detail is provided in three appendices. Overall. Reinhart.countries are quick to releverage (see Reinhart. repayment. whereas previous studies of the same era typically included at most a couple of each. Standard and Poor’s (various years) and authors’ calculations. Purcell and Kaufman (1993). Rogoff. The Kolmogorov–Smirnoff test for comparing the equality of two distributions rejects the null hypothesis of equal distributions at the 1% significance level. our dataset includes thirteen African 13 . A Global Database on Financial Crises with a Long-term View In this section. Suter (1992). Macdonald (2003). we provide a slim outline of the character of the sample and the building blocks of this database. Figure 6 Duration of Default Episodes: 1800-2006 frequency of occurrence. Country coverage Table 1 lists the sixty-six countries in our sample. and Savastano (2003) for empirical evidence on this pattern). Notes: The duration of a default spell is the number of years from the year of default to the year of resolution.
several of the sovereign default virgins. Lastly. only Thailand existed as an independent state before the end of World War II. have become independent nations only relatively recently (column 2).countries. at least in the narrow sense that they have never failed to meet their debt repayment or rescheduled. at least in the first instance. Thailand and Korea. managed to avoid default only through massive International Monetary Fund loan packages during the last 1990s debt crisis and otherwise suffered much of the same trauma as a typical defaulting country. Singapore. Of course. the United States. say. This is an interesting subject for another study. Malaysia. qualify as such only because we are excluding events such as lowering the gold content of 10 Our sample excludes many of the world’s poorest countries. In Asia. twelve Asian countries. As the final column in Table 1 illustrates. the Latin American countries. plus North America and Oceana. (The mother country. notably the United States. many of these countries.10 Table 1 flags which countries in our sample may be considered default virgins. and we will have to calibrate our inter-country comparisons accordingly. Sweden. our sample of sixty-six countries indeed accounts for about 90 percent of world GDP. Norway. but here we are mainly interested in financial flows that. nineteen European countries. One conspicuous grouping of countries includes the high-income Anglophone nations. Finland and Denmark. especially. Canada. For others. the latter two countries.) Also included are all of the Scandinavian countries. Admittedly. who by and large cannot borrow meaningful amounts from private sector lenders. England. Also in Europe. the potential opportunity for default has been relatively short. there is Belgium. These recently independent countries have not been exposed to the risk of default for nearly as long as. Australia. Also. there is Hong Kong. particularly those in Africa and Asia. eighteen Latin American countries. Taiwan. and New Zealand. had a substantial market element. of default-free countries. 14 . and who have virtually all effectively defaulted even on heavily subsidized government-to-government loans. defaulted in earlier eras as we shall see.
All the data is annual—this includes the crises dates. It is notable that the non-defaulters. cases. if not earlier. starting in 1913. Dates and Frequency of Coverage Appendix A describes the data in detail. The latter is decomposed into short-term and long-term debt in many. This is an issue we will return to in Section IV. 15 . However. Mauritius. For a large number of countries the time series go back to the 1800s. or does averting default beget high growth rates? Table 1 also flags which countries in our sample have not defaulted on their external debts. which has never defaulted or restructured. the coverage for our sample becomes much more comprehensive. Below we provide a list of the variables used in this study.the currency in 1933. while Appendices I and II provide specifics on coverage and sources on a country-by-country and period-by-period basis for all the time series. Crises-related variables Debt Our debt data covers central government public debt—external and domestic. are all hugely successful growth stories. This begs the question: Do high growth rates help avert default. Finally. there is one country from Africa. by and large. but not all. at least in the narrow sense that they have not outright failed to meet their debt repayment on schedule in an important way on even one occasion. Debt is perhaps the most novel feature of the dataset. or the suspension of convertibility in the nineteenth-century Civil War.
40 0.27 0.62 0.31 0.49 1962 1975 1960 1960 1831 1963 1968 1956 1960 1910 1591/1957 1964 1965 1368 1947 1949 1590 1945 1957 1948 1947 1965 1949 1769 1282 1830 980 1917 943 1618 1829 1918 1569 1581 1905 1918 1139 1878 1457 1476 1523 1453 1066 0.67 0.00 0.03 0.18 0. Regions.40 0.06 0.42 0.06 0.00 0.38 0.16 0.48 0. and World GDP Country (An asterisk denotes no sovereign default or rescheduling history) Africa Algeria Angola Central Africa Republic Cote D’Ivoire Egypt Kenya Mauritius * Morocco Nigeria South Africa Tunisia Zambia Zimbabwe Asia China Hong Kong * India Indonesia Japan Korea * Malaysia * Myanmar Philippines Singapore * Taiwan * Thailand * Europe Austria Belgium * Denmark * Finland * France Germany Greece Hungary Italy Netherlands * Norway * Poland Portugal Romania Russia Spain Sweden Turkey United Kingdom * Year of Independence Share of World Real GDP 1990 International Geary–Khamis US dollars 1913 1990 0.53 0.10 0.72 0.02 0.00 0.27 0.22 1.27 0.23 0.40 0.70 0.25 3.10 0.29 0.35 0.33 0.11 0.37 0.49 0.32 0.00 0.25 1.75 0.03 0. Countries.56 1.79 4.00 0.34 0.Table 1.54 0.95 0.00 8.80 8.65 2.24 0.70 4.43 0.52 0.00 0.23 5.67 8.68 0.91 0. 16 .57 1.50 1.36 0. Notes: An asterisk denotes no sovereign external default or rescheduling history.60 3.22 Sources: Correlates of War (2007).10 0.00 0.05 1.63 0.31 3.66 8.29 8.02 0.01 0.13 3.86 1.05 7.30 4.94 0.74 0. Maddison (2004).47 1.64 0.34 0.53 0.80 7.09 0.13 0.
For the New World (the United States and some of the larger Latin American countries).11 0.02 0.06 0. Maddison (2003). On the basis of this data.00 0.00 0.38 0.23 0.41 1.Table 1 (concluded) Countries.00 0.16 0.07 0.00 0.31 0.24 0. these data go back to the 1700s.04 0.74 0.12 1.91 1907 0.03 1.00 0.21 Total Sample-66 countries 93. Prices The data on prices is the most comprehensive in our set of variables. and World GDP Year of Independence Share of World Real GDP 1990 International Geary–Khamis US dollars 1990 0.59 1.15 0.05 0. we use consumer prices (or cost-of-living) indices.28 18.14 0.00 0. going back to the early Middle Ages for Europe (including Turkey) and Asia. Regions.24 1913 Latin America Argentina Bolivia Brazil Chile Colombia Costa Rica Dominican Republic Ecuador El Salvador Guatemala Honduras Mexico Nicaragua Panama Paraguay Peru Uruguay Venezuela North America Canada * United States * Oceania Australia * New Zealand * 1816 1825 1822 1818 1819 1821 1845 1830 1821 1821 1821 1821 1821 1903 1811 1821 1811 1830 1867 1783 1. 17 .95 0.17 89.93 1901 0.00 0.59 0.78 0.05 0.07 0.04 0.91 0.05 2.04 Sources: Correlates of War (2007).00 0.00 0.70 0.00 0. we construct the inflation series that allow us to date inflation crises.94 21.06 0. Where possible.
As in Reinhart and Rogoff (2004). for which we have data through the mid-1800s for 11 countries. GDP data for most countries prior to the twentieth 18 . we use market-based exchange rates. these provide some of the most reliable data on country size and economic strength in the era prior to development of conventional national income. Having reasonably accurate output data is thus of enormous help in calibrating the severity of crises. Trade. The trade data (exports and imports) are next in reliability to the fiscal data. including African countries (where data is relatively scarce). throughout most of their colonial history. These data underpin our dating of currency crashes. Government Finances. exchange rate data are constructed from the silver content of the currency. On the whole. Unfortunately. and GDP Our dataset incorporates data on central government expenditures and revenues. Furthermore. the Course of the Exchange in Amsterdam established actual market-based exchange rates. these data are available for many countries. for which we have a far more comprehensive coverage.Exchange rates Exchange rates in this database come in two forms: For the pre-1600s period. where possible. Varieties of Crises: Banking. Like their fiscal counterparts. Particulars of the criteria used to define a banking crisis or an external or domestic default crisis are given in Appendix A. these data offer longer history than the national accounts that are of a relatively more modern vintage. marking the beginning of modern exchange rates. beginning in the early 1600s. and external and domestic default These time series are dichotomous variables that take on the value of one if it is a crisis year and zero otherwise and are standard in the literature on crisis.
exports. ratios.. we also reconstruct net flows by taking gross new issuance minus repayment. financial hegemony. Fortunately. etc. For many emerging markets. data are only available sporadically and at long intervals. as discussed in Appendix A. which is especially limiting in trying to assess the impact of crises. Financial center data and global commodity prices In modern times. with the oldest dating back to 1790. During most of the nineteenth century. To capture developments in financial centers post-1800. and GDP series in our analysis is to scale debt. For the post-war. we rely on the actual balance-ofpayments data. Britain was the global financial center. Since World War II. we include: measures of short. as Bulow and Rogoff (1990) and others have argued. Capital Flows Pre–World War II gross capital flows are measured by data on debentures.S. but both countries were influential during the long transition period from British to U. taking into account partial defaults and negotiated interest rate reductions that often take place during rescheduling episodes. Where possible. emerging market financial crises have often been triggered by events at the center. real GDP. The primary use of the revenue. 19 . that is to construct the standard debt-to-revenues. we can use government revenue and trade data to supplement these estimates. Our historical dataset combines several different indices of commodity prices. it has been the United States. and current account balances. Commodity prices have long been thought to be another important global driver of the depression–prosperity cycles in modern times.and long-term interest rates. we do have reliable estimates for a sufficient number of countries so as to be able to draw broad conclusions and. as reported by the multilateral institutions or the country sources. of course.century are quite uneven.
IV. Serial Default 1350–2006 When one looks carefully, virtually all countries have defaulted at least once and many several times on external debt during their emerging market economy phase, a period that typically takes at least one or two centuries. Early Default, 1500 –1799 Today’s emerging markets can hardly claim credit for inventing serial default. Table 2 lists the number of defaults, including default years, between 1300 and 1799 for a number of now rich European countries (Austria, France, Germany, Portugal, and Spain). As the table illustrates, today’s emerging market countries did not invent serial default. Rather, a number of today’s now-wealthy countries, had similar problems when they were “emerging markets.”
Table 2. The Early External Defaults: Europe, 1300–1799
Years of default
Number of defaults
Austria England France
Germany (Prussia) Portugal Spain
1796 1340, 1472, 1594* 1558, 1624, 1648 1661, 1701, 1715 1770, 1788 1683 1560 1557, 1575, 1596, 1607, 1627, 1647
1 2* 8 1 1 6
Sources: MacDonald (2006), Reinhart, Rogoff and Savastano (2003) and sources cited therein. The “*” for England denotes our uncertainty at this time about whether its default was on domestic or external debt.
Spain’s defaults establish a record that remains as yet unbroken. Indeed, Spain managed to default seven times in the nineteenth century alone, after having defaulted six times in the preceding three centuries.
With its later string of nineteenth-century defaults, Spain took the mantle for most defaults from France, which had abrogated its debt obligations on eight occasions between 1500 and 1800. Because the French monarchs had a habit of executing major domestic creditors during external debt default episodes (an early form of “debt restructuring”), the population came to refer to these episodes as “bloodletting.”11 The French Finance Minister Abbe Terray, who served from 1768–1774, even opined that governments should default at least once every 100 years in order to restore equilibrium (Winkler, p. 29).12 Remarkably, however, despite all the trauma the country experienced in the wake of the French Revolution and the Napoleonic Wars, France eventually managed to emerge from its status of serial default. France did not default after 1812 in the nineteenth or twentieth century nor (so far, anyway) in the twenty-first century. There is, however, some debate as to whether France and others defaulted on a portion of their World War I debts to the United States. 13 Austria and Portugal defaulted only once in the period up to 1800, but then each defaulted a handful of times during the nineteenth century, as we shall see. England, however, is perhaps an even earlier graduate. Edward III, of Britain, defaulted on debt to Italian lenders in 1340 (see, for example, MacDonald, 2007), after a failed invasion of France that set off the Hundred Years’ War. A century later, Henry VIII, in addition to engaging in an epic debasement of the currency, seized all the Catholic Church’s vast lands. While not strictly a bond default, such seizures, often accompanied by executions, qualify as reneging on financial obligations.
See Reinhart, Rogoff and Savastano (2003) who thank Harald James for this observation. One wonders if Thomas Jefferson read those words, in that he subsequently held that “the tree of liberty must be refreshed from time to time with the blood of patriots and tyrants.” See Lloyd (1934).
Sovereign Defaults, 1800–2006 Starting in the nineteenth century, the combination of the development of international capital markets together with the emergence of a number of new nation states, led to an explosion in international defaults. Table 3 lists nineteenth-century default and rescheduling episodes in Africa, Europe and Latin America. We include debt reschedulings, which the international finance theory literature rightly categorizes as negotiated partial defaults (Bulow and Rogoff, 1989). We briefly digress to explain this decision, which is fundamental to understanding many international debt crisis episodes. Reschedulings constitute partial default for two reasons. The first reason, of course, is that debt reschedulings often involve reducing interest rates, if not principle. Second, and perhaps more importantly, international debt reschedulings typically saddle investors with illiquid assets that may not pay off for decades. This illiquidity is a huge cost to investors, forcing them to hold a risky asset, often with compensation far below market. It is true that in some cases, investors that held defaulted sovereign debt for a sufficient number of years—sometimes decades—have often yielded a return similar to investing in relatively riskless financial center bonds (U.K. or later U.S.) over the same period. Indeed, a number of papers have been written showing precisely such calculations (e.g., Mauro, Sussman and Yaffa, 2006). While interesting, it is important to underscore the fact that the right benchmark is the return on high-risk illiquid assets, not highly liquid low-risk assets. It is no coincidence that in the wake of the US sub-prime mortgage debt crisis of 2007, sub-prime debt sells at steep discount relative to the expected value of future repayments. Investors rightly believe that if they could pull out their money, they could earn a much higher return elsewhere in the economy provided they are willing to take illiquid positions with substantial risk. And 22
Honduras. made up for lost time by defaulting four times. and again starting in the mid-1880s through the early 1890s. Most of these defaults are associated with Latin America’s wars of independence. Thus the distinction between debt reschedulings—negotiated partial defaults—and outright defaults (which typically end in partial repayment) is not a sharp one. there are notable global default episodes during the late 1860s up to the mid-1870s. By contrast. We will later look at this clustering a bit more systematically. Most of Africa and Asia was colonized during this period. 23 . not to mention university endowments. and Costa Rica. Colombia and the Dominican Republic each defaulting four times. which gained its independence only in 1829. Although none of the subsequent clusterings is quite so pronounced in terms of number of countries. Greece. Note that a number of countries in Europe defaulted during or just after the Napoleonic wars. Austria defaulted a remarkable 5 times. allowing Latin America and Europe a substantial head start. Table 3 also lists each country’s year of independence. Investing in risky illiquid assets is precisely how venture capital and private equity. The only African countries to default during this period were Egypt (1876) and Algeria (1867). while many countries in both Latin America (plus their mother country Spain) defaulted during the 1820s. Default was similarly rampant throughout the Latin American region.of course they are right.. with Venezuela defaulting six times. a venture capital investment. have succeeded (until now) in earning enormous returns. albeit not quite so prolific as Spain. Looking down the columns of Table 3 also gives us a first glimpse at the clustering of defaults across regions and internationally. debt reschedulings at negotiated below-market interest rates give the creditor risk with none of the upside of say.
1816 1812 1814 1807. 1821 Paraguay. 1873 1874 1872 1868 1826 1828 1828 1828 1827. 1821 Nicaragua. 1830 1 Dates 1825–1849 1850–1874 1875–1899 1876 1867 1802. 1844 1828 1826 1826. 1822 Chile. 1894. Sources: Standard and Poor’s. 1820 1812 1851. 1818 Colombia. 1898 1860 1893 1868 1809. 1843 1814 1828. 1830 El Salvador. 1811. 1891 1892. 24 . 1841. Reinhart. 1867. External Default and Rescheduling: Africa. and Latin America. 1816 Bolivia. 1845 Ecuador. 1848 1873 1866 1874 1860. 1813 1850 1812 1826. Europe. Rogoff and Savastano (2003) and sources cited therein. Purcell and Kaufman (1993). 1819 Costa Rica. 1821 Honduras. 1872 1826 1826 1828 1850. 1811 Peru.Table 3. 1805. 1865 The dates are shown for those countries that became independent during the nineteenth century. 1897. Nineteenth Century Country/date of independence 1 1800–1824 Africa Egypt. 1833. 1845 1839 1831. 1837. 1821 Guatemala. 1831 Tunisia Europe Austria–Hungary France Germany Hesse Prussia Schleswig– Holstein Westphalia Greece. 1825 Dominican Republic. 1825 Brazil. 1899 1898 1894 1892 1876 1876. 1821 Mexico. 1829 Netherlands Portugal Russia Spain Sweden Turkey Latin America Argentina. 1899 1894 1898 1876. 1811 Venezuela. 1834 1852 1890 1885 1882 1876 1827 1890 1875 1898 1880 1880 1895 1892. 1821 Uruguay.
including among the many newly colonized countries. countries were independent throughout the entire twentieth century. with only a few exceptions. Table 4 shows defaults in Africa and Asia. Ecuador and Peru’s six defaults. Whether these massive interventions were well advised is an entirely different issue that we will set aside here. the notion that countries outside Latin American and low-income Europe were the only ones to default during the twentieth century is an exaggeration. 25 .Next we turn to the twentieth century. it was forced to reschedule its external debt three times since independence. In Table 5. Indonesia has also defaulted four times. Nigeria. Table 5 looks at Latin America and Europe. In point of fact. has defaulted a stunning five times since achieving independence in 1960. despite its oil riches. including especially the period of the Great Depression. The latter crisis saw somewhat fewer technical defaults thanks to massive intervention by the official community. albeit not since 1972. notable are Turkey’s five defaults. Again. as in the earlier tables. and Brazil’s seven. more than any other country over the same period. India prides itself on escaping the 1990s Asian crisis (thanks to massive capital controls and financial repression). Thus. counting its first default in 1903 during an earlier era of independence. particularly by the International Monetary Fund and the World Bank. it did default on external debt in both 1921 and 1939. when much of the world went into default. we see that country defaults tend to come in clusters. as Table 4 illustrates. and also the 1990s debt crisis. Morocco. regions where. the 1980s debt crisis. to say the least. also defaulted four times in the twentieth century. While China did not default during its communist era.
1947 Indonesia. However to gain further perspective into countries default histories. we count it as one episode. but there is some arbitrariness to this measure. 2004 1985. Purcell and Kaufman (1993). so that when a follow-on default occurs within two years of an earlier one. 1960 South Africa. 1947 Sri Lanka. 1965 Asia China Japan India. 1972 1966 1998. 1963 Morocco. particularly if debt restructuring terms are Table 4. Sources: Standard and Poor’s. 1982 The dates are shown for those countries that became independent during the twentieth century. 2000 1983. 1960 Egypt Kenya. Rogoff and Savastano (2003) and sources cited therein. Default episodes can be connected. 1983 1983.So far we have focused on number of defaults. 1975 Central African Republic. We have tried in Table 4 to exclude obviously connected episodes. 1956 Nigeria. we look next at the number of years each country has spent in default since independence. 26 . 1992. 2000. 1948 Philippines. 1986. 1969. 1910 Zambia. 1989. Twentieth Century–2006 Country/date of independence 1 1900–1824 Africa Algeria. 2002 2002 1983 1980. 1962 Angola. 1993 1983 2000 1903 1965 1921 1939 1942 1958. Default and Rescheduling: Africa and Asia. Reinhart. 1 harsh and make relapse into default almost inevitable. 1964 Zimbabwe. 1960 Cote D’Ivoire. 2001. 1986 1982. 1948 1925–1949 Dates 1950–1974 1975–2006 1991 1985 1981. 2000 1984 1994. 1949 Myanmar.
2001 1980. 1940 1932.Table 5. 1998 1978. 1935 1932 1931 1929 1932. 1940 1951. Table 6 gives. Purcell and Kaufman (1993). 1983. 1941 1936. 1989 1981 1982 1979 1983. 1978. 1986 1991. 1984 1983. 1974 1962 1981 1981. while there are many defaults in Asia. 1937 1931 1932. 1956 1902. 1964 1961. 1918 Poland. 1972. 1939 1932 1932. It is notable that. 1915 1920 1969 1915 The dates are shown for those countries that became independent during the twentieth century. Twentieth Century–2006 Country/date of independence 1 1900–1824 Europe Austria Germany Greece Hungary. 1999 1986. 27 . 1986. Reinhart. 1918 Romania Russia Turkey Latin America Argentina Bolivia Brazil Chile Colombia Costa Rica Dominican Republic Ecuador El Salvador Guatemala Honduras Mexico Nicaragua Panama. 1982 1982. 2004 1906. 1903 Paraguay Peru Uruguay Venezuela 1 Dates 1925–1949 1950–1974 1975–2006 1938. the year of independence. 1995. 1940 1933 1918 1915 1931. 1984 1982. the total number of reschedulings (using our measure) and the share of years since 1800 (or since independence. Default and Rescheduling: Europe. for each country. We begin by tabulating the results for Asia and Africa in Table 6. 2003 1976. 1909. 1966. 1980. 1963. if more recent) spent in a state of default or rescheduling. 1990. 1914 1931 1931. 1987 1986. Rogoff and Savastano (2003) and sources cited therein. and Latin America. 1938 1933 1928 1932 1932 1932 1931 1933 1961. 1914 1921 1914 1911. 1989. 1990. 2005 1982. 1987. 2003 1983. 1989 1983 1983 1900 1901 1981. Sources: Standard and Poor’s.
Sources: Authors’ calculations.0 1 1 2 2 2 2 0 4 5 3 1 1 2 2 0 3 4 1 0 0 1 1 0 2 0 0 For countries that became independent prior to 1800 the calculations are for 1800–2006.0 0.4 53. India. Purcell and Kaufman (1993).5 13.5 16. say. Africa’s record is much worse.0 0. one main reason why African defaults are less celebrated than.2 48. Year of Independence–2006 Country Year of Independence Share of years in default or rescheduling since 1 independence or 1800 Total number of defaults and/or reschedulings Africa Algeria Angola Central African Republic Cote D’Ivoire Egypt Kenya Mauritius Morocco Nigeria South Africa Tunisia Zambia Zimbabwe Asia China Hong Kong India Indonesia Japan Korea Malaysia Myanmar Philippines Singapore Sri Lanka Taiwan Thailand 1 1962 1975 1960 1960 1831 1963 1968 1956 1960 1910 1591/1957 1964 1965 1368 1947 1949 1590 1945 1957 1948 1947 1965 1948 1949 1769 13.6 0. 28 . with several countries spending roughly half their time in default.3 0. Standard and Poor’s.7 15. Reinhart. China and the Philippines spent more than 10 percent of their independent lives in default (though of course on a population-weighted basis.9 3.9 40.0 8.0 15. Only Indonesia. Latin American defaults.3 59. the typical default was resolved relatively quickly. that is most of the region).Table 6. Certainly.5 5. Rogoff and Savastano (2003) and sources cited therein.4 13.3 5.8 0.0 0.3 27. The Cumulative Tally of Default and Rescheduling: Africa and Asia.7 21.0 6.0 11. is because the debts of African countries have typically been relatively small.4 0. and the systemic consequences less.2 5.
One way of summarizing the data in Tables 6 and 7 is by looking at a time line giving the number of countries in default or restructuring at any given time. Venezuela. A number of Latin American countries spent roughly 40 percent of their years in default. and Cost Rica. This wide spacing no doubt reflects adjustments debtors and creditors make in the wake of each default cycle. illustrate the clustering of defaults in an even more pronounced fashion than our debt tables that mark first defaults. Greece. Overall. which has lived in a perpetual state of default). Over time. but only after a long lull. are far from continuous. while recurrent. in which spikes represent a surge in new borrowers. spent more than half the years since 1800 in default. Dominican Republic. one can see that default episodes. depending especially on how long countries tend to stay in default (compare serial-debtor Austria. Peru. These figures. We have already done this in Figure 1 in section II. with Greece. this caution usually gives way to optimism and profligacy. Nicaragua. though. many emerging markets are following quite conservative macroeconomic policies. which has tended to emerge form default relatively quickly. today. including Mexico. although there is a great deal of variance. The same is true across countries. as noted. 29 .Table 7 gives the same set of statistics for Europe and Latin America. For example.
7 0.1 23.0 Total number of defaults and/or reschedulings Europe Austria Belgium Denmark Finland France Germany Greece Hungary Italy Netherlands Norway Poland Portugal Romania Russia Spain Sweden Turkey United Kingdom Latin America Argentina Bolivia Brazil Chile Colombia Costa Rica Dominican Republic Ecuador El Salvador Guatemala Honduras Mexico Nicaragua Panama Paraguay Peru Uruguay Venezuela North America Canada United States Oceania Australia New Zealand 1 1282 1830 980 1917 943 1618 1829 1918 1569 1581 1905 1918 1139 1878 1457 1476 1523 1453 1066 1816 1825 1822 1818 1819 1821 1845 1830 1821 1821 1821 1821 1821 1903 1811 1821 1811 1830 1867 1783 1901 1903 7 0 0 0 8 8 5 7 1 1 0 3 6 3 5 13 0 6 0 7 5 9 9 7 9 7 9 5 7 3 8 6 3 6 8 8 10 0 0 0 0 For countries that became independent prior to 1800 the calculations are for 1800–2006. 30 .5 22.0 25.2 27.2 38. Sources: Authors’ calculations. and Oceania.3 39.6 23. Purcell and Kaufman (1993).6 45.0 0.0 58.9 23. North America.0 32.0 13.2 29.0 0. The Cumulative Tally of Default and Rescheduling: Europe.0 0.2 26.Table 7.3 34.1 3.4 27. Latin America. Reinhart.5 36.0 0.0 15.3 12.0 50.8 38.0 0. Year of Independence–2006 Country Year of Independence Share of years in default or rescheduling since 1 independence or 1800 17.6 37.0 32.5 0.4 0.4 6.6 10. Rogoff and Savastano (2003) and sources cited therein. Standard and Poor’s.0 44.0 40.4 0.0 0.3 0.4 64.
V. Global Cycles and External Defaults As Kaminsky, Reinhart and Vegh (2004) have demonstrated for the post-war period, and Aguirre and Gopinath (2007) have recently modeled, emerging market borrowing tends to be extremely pro-cyclical. Favorable trends in countries’ terms of trade (meaning typically, high prices for primary commodities) typically lead to a ramp-up of borrowing that collapses into defaults when prices drop. The upper panel of Figure 7 is an illustration of the commodity price cycle, which we split into two periods, the pre– and post–World War II periods. As the figure broadly suggests for the period 1800 through 1940, (and as econometric testing corroborates), spikes in commodity prices are almost invariably followed by waves of new sovereign defaults. The lower panel of Figure 7 calibrates the same phenomenon for the 1990s and 2000s. We note that while the association does show through in the pre–World War II period, it is less compelling subsequently. As observed earlier, defaults are also quite sensitive to the global capital flow cycle. When flows drop precipitously, more countries slip into default. Figure 8 documents this association by plotting the current account balance of the financial center (the United Kingdom and the United States) against the number of new defaults prior to the breakdown of Bretton Woods. There is a marked visual correlation between peaks in the capital flow cycle and new defaults on sovereign debt. The financial center current accounts capture “global savings glut” pressures, as they give a net measure of excess center-country savings, rather than the gross measure given by the capital flow series in our dataset.
Figure 7. Commodity Prices and New External Defaults 1800–1939
World commodity prices, deviation from trend, 3-year average
12 N u m ber of coun tries
Number of new defaults 3-year sum
4 -0.4 2
0 1800 1810 1820 1830 1840 1850 1860 1870 1880 1890 1900 1910 1920 1930
Number of new defaults 3-year sum (left axis)
0.2 Number of countries 8 0.1 6
World commodity prices, deviation from trend 3-year average (right axis)
0 1940 1950 1960 1970 1980 1990 2000
Sources: Boughton (1991), The Economist, Gayer, Rostow, and Schwartz (1953), World Economic Outlook, IMF and the authors’ calculations based on the sources listed in Table AI.9. For external default, see Appendix I. Notes: New external defaults refer to the first year of default. Because of the marked negative downward drift in commodity prices during the sample period, prices are regressed against a linear trend, so as to isolate the cycle.
In d ex lev el
Net Capital Flows from the Financial Center and Default 1818-1968
18 30 16
UK and US Current account balance, 3-year sum as a percent of GDP (right axis) Number of new defaults 3-year sum
12 N u m ber of cou n tries
15 P ercen t 10 5 0 -5
0 1818 1828 1838 1848 1858 1868 1878 1888 1898 1908 1918 1928 1938
Sources: Historical Statistics of the United States (2007), Imlah (1958), Mitchell (1993), Bank of England. Notes: The current account for the UK and the US is defined according to the relative importance (albeit in a simplistic arbitrary way) of these countries as the financial centers and primary suppliers of capital to the rest of the world: 1800–1913 UK receives a weight of 1 (US, 0); 1914–1939 both countries’ current accounts are equally weighted; post-1940, US receives a weight equal to 1.
We recognize that the correlations captured by these figures are merely illustrative, and different default episodes involve many different factors. But aside from illustrating the kind of insights one can get from such a long and broad dataset, the figures do bring into sharp relief the vulnerabilities of emerging markets to global business cycles. The problem is that crisis-prone countries, particularly serial defaulters, tend to over-borrow in good times, leaving them vulnerable during the inevitable downturns. The pervasive view that “this time is different” is precisely why it usually isn’t different, and catastrophe eventually strikes again. The capital flow cycle illustrated in Figure 8 comes out even more strikingly in many individual country graphs, but we do not have space here to include these. An early
the 1930s and the 1980s. This summary of events. 1627. of course. Crises Emanating from the Center We have already seen that major global spikes in defaults began in the 1820s. based on seventeenth-century Spain. So. showing how the 1825 crisis began with a financial crisis in London that spread to Europe. by most accounts. is illustrated in Figure 9. The 1930s spike was caused by the worldwide depression that. but the tables are nevertheless illustrative of some of the common shocks that might have sparked the commodity and capital flow cycles seen in the figures in the preceding 34 . European State Finance Database. is silent as to the magnitude of the international transmission channel. though. The figure illustrates how defaults often follow in the wake of large spikes in capital inflows. too.example. did the 1980s spike. and 1647 20 15 10 5 0 1600 1606 1612 1618 1624 1630 1636 1642 1648 1654 1660 1666 1672 1678 Sources: Gelabert (1999a and b). which was caused by U. disinflation. 16011679 (3-year moving sum) 35 30 25 Millions ducats De fau lts of 1607. began in the United States. What of earlier eras? Tables 8 and 9 give a thumbnail summary of events. causing global trade and capital flows to plummet. Figure 9 Spain: Defaults and Loans to the Crown. the 1870s.S.
2000). all of Latin America. Contagion mechanisms Upon Peru’s 1826 default. and Venezuela) default later in the year. Ecuador. It is also notable that crises in the center do not always lead to full-blown global financial crises. a major lender to Argentina. By 1876. As far as the periphery is concerned. Capital flows to the U. 1890 Argentina stops dividend payments in April 1890. Countries affected Chile and Gran Colombia (which comprised today’s Colombia. Crises at the Financial Center and Their International Repercussions: 1800’s Origin of the shock: country and date London. Crisis spreads quickly to Italy. of course. Other examples where crises in the center lead to global financial crises include the German and Austrian stock market collapse of 1873 (which has been studied by Eichengreen in several contributions) and. By 1828. Trade and capital flows with Latin America plummet. German and Austrian stock markets collapse. and Russia (Kindleberger. Strong economic links between Britain and Argentina through trade and financial integration. the Wall Street stock market crash of 1929. Crisis mostly confined to Argentina and Uruguay (which defaulted in 1891). France. Initial defaults in small Central American nations in January 1873 leads to a fall in bond prices. and Belgium. and 8 Latin American countries had defaulted.S. leaps the Atlantic in September and crosses back again to involve England. Baring Crisis. sections. Egypt. the world recession (1873– 1879) results in a dramatic fall in trade and capital flows originating in the core. Holland. with the exception of Brazil.Table 8. declares itself insolvent in November 1890. had defaulted. fall in the wake of German crisis (Kindleberger 1989). as illustrated by the Barings crisis of 1890 (where the repercussions were 35 . Ensuing world recession (1873–1879) leads to debt servicing problems in the periphery through reduced exports and tax revenues. leading to a domestic bank run. the Ottoman Empire. The House of Baring. London bond holders immediately become concerned about other Latin American countries’ ability to service their debts. 1825–1826 Nature of common external shock Major commercial and financial crises in London during 1825–26. bond prices collapse. Greece. May 1873 French war indemnity paid to Prussia in 1871 leads to speculation in Germany and Austria. which spread to continental Europe.
For example. During the same year. which transmitted mainly to Germany. as well as by the US stock market crash and bank runs of 1907. Domestic Debt So far. when domestic debt accounted for 54 percent of total debt. in the midst of one of Mexico’s longer default spells. But this is not new. Figure 10 makes this point more systematically by examining the behavior of domestic and external sovereign debt in the run-up to default. France and Italy. as opposed to less than 20 percent in the early 1980s. but not yet looked at domestic debt buildups. just before default. Some have argued that external defaults are less likely in the present period because governments are now relying more on domestic debt. domestic debt accounted for 52 percent of Brazil’s debt and 63 percent of Peru’s debt. a fact that ought to be looked at more closely by those who believe that the recent shift by emerging markets towards domestic debt. domestic debt amounted to 64 percent of total public debt. we have focused on external debt crises. 36 . of course. both components rise rapidly. In 1837.mainly felt by Argentina and Uruguay). normalized by their levels four years prior to the credit event. was a period prior to the massive wave of external defaults in the 1930s. As can be seen. in 2001 to 2005. domestic government debt in Mexico and Colombia accounted for more than 50 percent of total debt. The 1920s. somehow provides strong protection to creditors. The bars give the average experience of both types of debt. and away from external debt. at about the same rates. The earliest year where our dataset has domestic debt statistics for Colombia is 1923.
37 .But domestic debt buildups often happen in the aftermath of external default. precisely because countries have difficulty borrowing abroad. which had a massive run-up in domestic debt following its default of 1921. Figure 11 illustrates the case of China.
1895-1946 14000 12000 Millions Chinese $ (yuan) 10000 8000 6000 4000 2000 0 1895 1899 1903 1907 1911 1915 1919 1923 1927 1931 1935 1939 1943 The default of 1939-1949 The default of 1921-1936 Sources: Cheng (2003).Figure 10 The Runup in Domestic and External Debt on the Eve of Default. Figure 11 China: Domestic Public Debt Outstanding. Notes: For 1895–1915 the debt stock is calculated from domestic debentures data. 120 Index External 110 t-4=100 100 90 t-4 t-3 t-2 t-1 T Sources: See Appendix I and Reinhart and Rogoff (2008a). China did not have domestic debt prior to its 1895 domestic issue. According to Huang. UN and authors’ calculations. 38 . Average Default Episode: 1800-2006 150 Domestic 140 130 . Huang (1919). Notes: T refers to the year of the external debt crisis.
We are only able here to give a helicopter tour (so to speak) of our entire cross-country inflation dataset which. Default through inflation If serial default is the norm for a country passing through the emerging market state of development. including the United States (whose inflation rate exceeded 20 percent during the country’s 1860s civil war) has managed to escape bouts of high inflation. Money creation and interest costs on debt all enter the government’s budget constraint and. There is nothing “original” about it. A government that chooses to default on its debts can hardly be relied on to preserve the value of its country’s currency. nor should it be treated as such. defaults on domestic debt appear to be associated with similar magnitudes of output loss as defaults on external debt. Of course. students of the history of metal currency 39 . domestic default and inflation are all integrally related. In this section. a sovereign will typically grab from any and all sources. in a funding crisis. to our knowledge. we give an overview of results from our annual cross-country database on inflation going back to 13th-century Europe. Although some writers seem to believe that inflation only really became a problem with the advent of paper currency in the 1800s. And as we show in Reinhart and Rogoff (2008a). But we have also established that domestic debt has long been fully as significant as external debt in meeting emerging market financing needs. then the tendency to lapse into periods of high and extremely high inflation is an even more striking common denominator. the problems of external default. VI.We have already acknowledged that domestic debt is not equivalent to foreign debt. No emerging market country in history. spans considerably more episodes of high inflation and across a broader range of countries than any existing.
both in the aftermath of the Napoleonic War. Turkey. or by shaving down coins and reissuing smaller coins in the same denomination. either by mixing in cheaper metals. Table 10 looks at the same statistics for European countries during the nineteenth century. often adding up to 50 percent or more. The second column of the table looks at cumulative currency debasement over long periods.will know that governments found ways to engineer inflation long before that. The main device was through debasing the content of the coinage. managed to reduce the silver content of its coins by 50 percent. The table illustrates how strikingly successful monarchs were at implementing inflationary monetary policy. Turkey’s debasement was 44 percent in 1586. Sweden achieved a debasement of 41 percent in a single year (1572). The pattern of sustained debasement emerges strikingly in Figure 12. which plots the silver content of an equally weighted average of the European currencies in our early sample (plus Russia and Turkey). while the UK achieved a 50 percent debasement in 1551. in 1829. 1228–1799. “The March Toward Fiat Money” shows that modern inflation is not as different as some might believe. Modern currency presses are just a more technologically advanced and more efficient approach to achieving the same end. 40 . Tables 9 and 10 give data on currency debasement across a broad range of European countries during the pre–paper currency era. where outliers include Austria’s 55 percent debasement in 1812. and Russia’s 57 percent in 1810.
we have the New Castille maravedi and the Valencia dinar) we calculate the simple average. The March Toward Fiat Money: Europe 1400-1850 Average Silver Content (in grams) of 10 Currencies Napoleonic Wars. for example.Figure 12. Notes: In the cases where there is more than one currency circulating in a particular country (in Spain. 17991815 in 1812 Austria debases currency by 55% 10 9 8 7 6 Grams 5 4 3 2 1 0 1400 1450 1500 1550 1600 1650 1700 1750 1800 1850 Sources: Primarily Allen and Unger and other sources listed in Table AI.4. 41 .
0 0. 42 .4 1.0 –10.0 –10.0 –41.3 6.8 11.7 –20.0 –56.9 –14.4 –12.1 –12.0 1464 Kingdom 1500–1799 –35.0 Austria Vienna kreuzer Belgium hoet France livre tournois Germany Bavaria– Augsburg pfenning Frankfurt pfenning Italy lira fiorentina Netherlands Flemish grote Guilder 1371–1499 1500–1799 1349–1499 1500–1799 1258–1499 1500–1789 1417–1499 1500–1799 1350–1499 1500–1798 1280–1499 1500–1799 1366–1499 1500–1575 1450–1499 1500–1799 1750–1799 1761–1799 1501–1799 1351–1499 1500–1650 1523–1573 –69.0 5.4 –32.0 Portugal reis Russia ruble Spain New Castille maravedis Valencia dinar Sweden mar ortug Turkey Akche 1527–1799 –59.5 –50.2 –70.5 –26.8 2.0 0.9 -25. a reduction in the silver content) All 15 percent or greater 0.8 1.0 0.0 –7.6 –44.7 –59.7 –83.7 7.7 19.4 1.5 0.2 14.0 0.0 0.7 2.0 0.3 14.0 3.2 0.1 0.4 –21.7 13.4 1463 1694 1498 1561 1303 1718 1424 1685 1404 1500 1320 1550 1488 1526 1496 1560 1766 1798 1642 1408 1501 1572 25.4 –91. Expropriation through Currency Debasement: Europe.0 0.1 –78.3 4.4 –12.3 United 1260–1499 –46.7 44.0 –11.4 –35.2 20.3 –62.0 5.3 –74.4.8 –20.5 –34.8 2.0 –26.9 –17.0 2.3 –43.7 12.0 0.8 –56.7 –34.8 3.0 2.9 1586 10.6 –42.3 3.8 –36.0 –3.3 0.1 0.3 –2.0 6.Table 9.7 3.0 1551 pence Sources: Primarily Allen and Unger and other sources listed in Table AI.0 13.7 –15.3 0.0 34.3 0.5 –16.7 -15.4 5.7 –14.8 –72.3 –25.0 –48.e.3 –42.2 1.3 4. 1258–1799 Country and currency Period covered Cumulative decline in silver content of currency ( percent) Largest debasement (percent) and year Share of years in which there was a debasement of the currency (i.0 1.5 –7.2 –21.
1 –6. however.0 1812 37.5 Country Period covered Largest debasement (percent) and year Austria 1800–1860 –58. poor crops.1 1816 3.0 Sources: Primarily Allen and Unger and other sources listed in Table AI.7 Germany Italy Portugal Russia Turkey United Kingdom 1800–1830 1800–1859 1800–1855 1800–1899 1800–1899 1800–1899 –2.0 1.0 0.0 1.3 –55.0 7.8 7.e. etc.0 –12.0 0. The figure shows a clear inflationary bias throughout history (although of course there are always periods of deflation due to business cycles.8 –56.2 0. Inflation However spectacular some of the coinage debasements reported in Tables 9 and 10.0 1800 1810 1829 1816 57.Table 10. a reduction in the silver content) All 15 percent or greater 11. there is no question that the advent of the printing press brought inflation up to a whole new level.2 –6. 43 .4 –41.2 0.0 0. inflation spikes radically. from 1500 to 2006 (taking a five-year moving average to smooth out cycle and measurement error).1 –2.3 –51.1 50.2 0.). the Nineteenth Century Cumulative decline in silver content of currency (percent) Share of years in which there was a debasement of the currency (i.0 –18.4. Starting in the twentieth century. Expropriation through Currency Debasement: Europe.6 –83.0 7. Figure 12 illustrates the median inflation rate for all the countries in our sample.
Table 11 gives data for the sixteenth through nineteenth century over a broad range of currencies. Poland. for example. and most experienced a significant number of years with inflation over 40 percent. and inflation over 40 percent almost one-third of the time. These are listed in Table AI.Figure 13 14 12 10 8 Percent Median Inflation Rate All Countries 5-Year Moving Average: 1500-2006 6 4 2 0 -2 1500 -4 1550 1600 1650 1700 1750 1800 1850 1900 1950 2000 Sources: There are innumerable sources given the length of the period covered and the large number of countries included. Korea experienced inflation of over 20 percent almost half the time until 1800. We look at country inflation data across the centuries in the next three tables. Take Korea. where the data go back to 1704. 44 . Even the United States experienced an episode of very high inflation. What is stunning is that every country in both Asia and Europe experienced a significant number of years with inflation over 20 percent during this era. has extremely similar ratios. The New World colonies of Latin America experienced frequent bouts of very high inflation long before the wars of independence from Spain. as inflation peaked at nearly 200 percent five percent in 1779. where our dataset begins in 1743.
9 143. South Africa.0 6.0 0 0 0 0 0 0 30.Table 11.6 173. but for thirteen African countries and twelve Asian countries.1 40.5 1780 1792 1763 1770 1765 1779 Hyperinflation is defined here as an annual inflation rate of 500 percent or higher (this is not the traditional Cagan definition).0 3.6 192.7 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 116.4 25.8 19.0 36.7 15.7 4.7 98.1 11.0 4.0 11.6 0.8 0.0 10.2 14.0 7.4 10.0 6. and the “New World” 1500–1799 Period covered Share of years in which inflation exceeded 20 percent 40 percent Number of hyperinflations1 Maximum annual inflation Year of peak inflation Country Asia China Japan Korea Europe Austria Belgium Denmark France Germany Italy Netherlands Norway Poland Portugal Spain Sweden Turkey United Kingdom The “New World” Argentina Brazil Chile Mexico Peru United States 1 1639-1799 1601-1650 1743-1799 1501-1799 1501-1799 1749-1799 1501-1799 1501-1799 1501-1799 1501-1799 1666-1799 1704-1799 1729-1799 1501-1799 1540-1799 1586-1799 1501-1799 14.2 1.0 4.0 0. Table 12 looks at the same years 1800–2006 as Table 11.2 92.4 10.8 12.4 39.8 6.9 99.5 1651 1602 1787 1623 1708 1772 1622 1622 1527 1709 1709 1762 1757 1521 1572 1621 1587 1777-1799 1764-1799 1751-1799 1742-1799 1751-1799 1721-1799 4.1 40 44.0 0.4 121.3 140.4 7. albeit South Africa’s record extends back 45 .8 53.1 18.1 77. Europe.4 19.9 8.1 4.0 29.6 80.1 185.1 22.0 31.0 4.7 4.2 25.8 31.0 43. Hong Kong and Malaysia have notably the best track records at resisting high inflation.1 83.0 0.8 33. “Default” through Inflation: Asia.0 43.3 34.5 19.4 2.9 2.3 0.2 7.2 5.5 65.
0 15.0 12.6 12.3 19.3 21.9 22.0 6.to 1896.1 141.7 23.0 33.5 0 0 0 0 0 0 0 0 0 26.2 11.3 1.0 14.8 568.6 4.0 4.2 72.0 1. 46 .0 7.2 4.5 1994 1941 1993 1980 1947 1995 1919 1943 1993 2006 1947 1949 1943 1966 1945 1951 1950 2002 1943 1973 1973 3 0 0 1 1 0 0 0 0 0 0 0 14 The dates in table 13 extend back prior to independence for many countries. “Default” through Inflation: Asia and Africa 1800–2006 Beginning of period covered Share of years in which inflation exceeded 20 percent 40 percent Number of hyperinflation years1 Maximum annual inflation Year of peak inflation Country Africa Algeria Angola Central African Republic Cote D’Ivoire Egypt Kenya Mauritius Morocco Nigeria South Africa Tunisia Zambia Zimbabwe Asia China Hong Kong India Indonesia Japan Korea Malaysia Myanmar Philippines Singapore Taiwan Thailand 1879 1915 1957 24.5 8.3 1. including for example Malaysia.9 35.0 0 4 0 69.7 23.6 14.6 3.6 78.3 1.216.7 3.4 0.7 1947 1996 1971 1952 1860 1949 1947 1940 1940 1896 1940 1943 1920 1800 1948 1801 1819 1819 1800 1949 1872 1938 1949 1898 1821 7.7 14.0 40.0 6.1 53.9 29.0 1.6 0.7 22.9 11.0 57.0 58.8 24.7 7.0 0.0 44.8 939.5 72.1 183.2 35.0 27.7 53.2 0.5 9.6 0.3 0.3 7.7 7.6 0.4 22.3 18.3 4.0 11. whereas Malaysia’s and Hong Kong’s only go back to 1949 and 1948 respectively.5 9.8 46.0 210.4 14.14 Table 12.3 10 14.416.5 29.0 0.579.0 0.
15 China. Indonesia over 900 percent in 1966. Latin America’s post–World War II inflation history is famously spectacular. Sahay and Vegh. putting that country on track to surpass the Republic of the Congo (not included in our sample). 47 . But even setting aside the hyperinflations. and Zimbabwe of over 1. Latin America. we would have picked up Zimbabwe’s 66. Finally. famously experienced paper-currencycreated high inflation episodes in the twelfth and thirteen centuries. The European experiences include the great post-war hyperinflations studied by Cagan (1956). China experienced over 1500 percent inflation in 194715.000 percent in 2006.000 percent in 1996.Most of the countries in Asia and Africa however. perhaps not surprisingly. Norway had 152 percent inflation in 1812. Fischer. (See for example. Angola had inflation of over 4. 2003) These episodes are in our database as well. has a still worse record. North America and Oceana. Table 13 lists inflation for 1800 through 2006 for Europe. which has experienced three hyperinflations since 1970 (Reinhart and Rogoff. Russia and Turkey experienced high inflation an extraordinarily large percent of the time. we see that countries such as Poland. and Sweden 36 percent inflation in 1918. Denmark 48 percent inflation in 1800. have experienced waves of high and very high inflation. The notion that Asian countries have been immune from Latin American–style high inflation is just as naïve as the notion that Asian countries were immune from default crises up until the late 1990s Asian financial crisis. Had we extended the table through 2007. with many episodes of peacetime hyperinflations in the 1980s and 1990s.000 percent inflation for 2007. Africa. which invented the printing press well ahead of Europe. as the table illustrates. Even the Asian tigers Singapore and Taiwan experienced inflation well over 20 percent in the early 1970s. 2002).
481.0 4.6 28.5 99.8 24.947.7 8.1 3.5 16.4 9.8 8.0 57.0 9.8 23.6 38. 1800–2006 Maximum Beginning Share of years in which Number of annual of period inflation exceeded hyperinflation inflation covered years1 20 percent 40 percent 1800 1800 1800 1861 1800 1800 1834 1924 1800 1800 1800 1800 1800 1854 1800 1800 1800 1800 20.4 1.7 1.0 74. “Default” through Inflation: Europe.5 2.9 17.0 131.9 23.9 17.9 53.63+26 491.1 0.2 1989 1985 1990 1973 1882 1982 2004 2000 1986 1990 1991 1987 1987 1974 1952 1990 1990 1996 1917 1864 1854 1980 48 .2 3.8 0.0 4 2 6 0 0 0 0 0 0 0 0 0 6 0 0 3 0 0 0 0 0 0 3.1 6.1 31.4 17.4 14.5 11.1 2.7 13.699.0 32.6 5.9 41.2 13.0 1.0 2.5 2.6 48.534.733.7 19.0 0.4 12.1 1.3 5.0 1.0 34.4 21.4 0.Country Table13.4 4.0 15.0 5.0 152.9 5.8 9.4 0. North America and Oceania.749.4 0.3 0.8 0.7 8.0 11.8 10.5 26.5 5.1 5.0 50.5 10.079.7 3.6 2.0 35.5 10.1 35.8 0.3 26.5 96.7 0.0 0.7 102.4 84.1 51.4 0.3 242.4 1.5 30.7 1.7 11.0 51.0 17.109.6 42.4 Year of peak inflation Europe Austria Belgium Denmark Finland France Germany Greece Hungary Italy Netherlands Norway Poland Portugal Russia Spain Sweden Turkey United Kingdom Latin America Argentina Bolivia Brazil Chile Colombia Costa Rica Dominican Republic Ecuador El Salvador Guatemala Honduras Mexico Nicaragua Panama Paraguay Peru Uruguay Venezuela North America Canada United States Oceania Australia New Zealand 1922 1812 1800 1918 1946 1923 1944 1946 1944 1918 1812 1923 1808 1923 1808 1918 1942 1800 1800 1937 1800 1800 1864 1937 1943 1939 1938 1938 1937 1800 1938 1949 1949 1800 1871 1832 1868 1800 1819 1858 24.0 19. Latin America.8 115.1 7.7 35.9 4.3 15.0 1.8 15.3 28.8 13.2 36.22E+10 3.02E+10 9.7 17.8 12.9 20.6 90.8 1.9 1.7 469.7 0.0 4.9 34.0 2 0 0 0 0 2 4 2 0 0 0 2 0 8 0 0 0 0 1.5 20.3 139.7 112.
following the same logic as in commenting on external default. Instead.inflation countries). probably the most surprising evidence comes from the Napoleonic Wars.16 Many observers.in. although New Zealand’s inflation rate reached 17 percent as recently as 1980. Exchange rate crashes Having discussed currency debasement and inflation crises. This is starkly illustrated in Figures 14 and 15. during which exchange rate instability escalated to a level that had not been seen before and was not to be seen again for nearly one hundred years. the last few years have been a relatively quiescent period in terms of very high inflation. although many countries (including Argentina. The significantly higher 16 At the time of this writing the “official” inflation rate in Argentina is 8 percent—informed estimates place it at 26 percent. have concluded that “this time is different. especially if one takes into account silver-based exchange rates. In this lengthy sample inflation crises and exchange rate crises travel hand. and Panama had 16 percent inflation in 1974. 49 . as with debt defaults. but. with the former depicting the incidence of high inflation and the latter showing median inflation. as regards exchange rate behavior. including at this late stage a long expose on exchange rate crashes seems somewhat redundant. Venezuela and of course Zimbabwe) still have very high inflation. experience suggests that quiet periods do not extend indefinitely. The database on exchange rates is almost as rich as that on prices. only New Zealand and Panama have no periods of inflation over 20 percent.” Perhaps.hand in the overwhelming majority of episodes across time and countries (with a markedly tighter link in chronic. As with debt defaults. and is described in detail in the Appendices.In all of Table 13.
Figure 14 Cu rre ncy Crashe s: Share of Cou ntrie s with an Annu al De pre ciation Gre ate r than 15 Pe rce nt: 1800-2006 50 40 Percent 30 20 10 0 N ap ol e oni c War s 1800 1815 1830 1845 1860 1875 1890 1905 1920 1935 1950 1965 1980 1995 Figure 15 Me dian Annu al De pre ciation All Cou ntrie s 5-Ye ar Moving Ave rage : 1800-2006 8 7 6 5 Napoleonic Wars 4 3 2 1 0 -11800 1815 1830 1845 1860 1875 1890 1905 1920 1935 1950 1965 1980 1995 -2 Sources: The primary sources are Global Financial Data.incidence of crashes and larger median changes in the more modern period are hardly a surprise. but there are numerous others that are listed in Appendix I. Percent 50 . and Reinhart and Rogoff (2003).
VII. and thus construct a composite index of financial instability that is multidimensional. while in the worst-case scenario (Argentina 2002. Namely. additions. Varieties of Crises We deal with five “varieties” of economic crises: external default. banking crises. currency crashes. Our study is based on a comprehensive new statistical dataset compiled by the authors that covers every region of the world and spans several centuries. Thus. or across countries in a particular region. Hence. We welcome suggestions for corrections.17 All these variables take on the value of one when there is a crisis and zero otherwise. involving so many primary and secondary historical sources (that do not always agree). in a tranquil year the tally across crises for that particular country would total zero. Inevitably. 17 The total would come to 6 if we include currency debasement—but for this there is far less data across countries. We next take simple averages across all countries. a database of this scale and scope. We selected Asia to highlight a point we have made earlier on more than one occasion. for instance) it would sum to five. as discussed. Conclusions This paper offers a detailed quantitative overview of the history of financial crises dating from the mid-fourteenth century default of Edward III of England to the present subprime crisis in the United States. and inflation outbursts. each country has an entry each year in the 0 to 5 range. 51 . domestic default. will contain some errors and omissions. that the 1997–1998 crisis was not the first and that the region had several protracted bouts of economic instability by international standards of the day. despite our best efforts. We have comparable figures for all the other regions. VIII. These are the time series shown for the full sample in Figure 16 for the whole sample and for Asia.
5-year Average Bad 1. currency crashes.and improvements of this database. which we will attempt to incorporate into the online version. while in the worst-case scenario (Argentina 2002. and inflation outbursts). Thus. Our principle aim here has been to illustrate some core features of this sweeping database. each country has an entry each year in the 0–5 range. we are inevitably obscuring important nuances surrounding historically diverse episodes. for instance) it would sum to five. and all these variables take on the value of one when there is a crisis and zero otherwise.4 N umber (fr om 0 to 5) Asia 1. Notes: We deal with five “varieties” of economic crises (external default. in a tranquil year the tally across crises for that particular country would total zero. in such a broad synthesis. Hence. Asia: 1800-2006 Average Number of Crises per Country. domestic default. First and foremost. trying to bring out a few fundamental regularities.8 0.4 0. with appropriate attribution and cross-referencing. banking crises. Figure 16 Variety of Crises.8 1. With these caveats in mind. we illustrate the near universality of 52 .6 1. We are fully aware that. this “panoramic” quantitative overview has revealed a number of important facts. We next take simple averages across all countries or across countries in a particular region and these are the time series shown above.6 0.2 1 0.2 All Countr ie s Good 0 1800 1813 1826 1839 1852 1865 1878 1891 1904 1917 1930 1943 1956 1969 1982 1995 Sources: The authors’ calculations on the basis of the data reported in Appendices I and II and the crises definitions described earlier.
it is argued. giving rise to periodic bouts of euphoria that usually end in tears. the height of humans has changed.episodes of serial default and high inflation in emerging markets. it appears to be exceptional. would Britain really have honored its debts. Indeed. Although the case of seventeenth-century England has been much studied. We show that global debt crises have often radiated from the center through commodity prices. Thanks to better-informed macroeconomic policies and more discriminating lending practices. 53 . Technology has changed. and shocks to investor confidence. and fashions have changed. seems to have remained a constant. capital flows. had Napoleon not invaded Russia and France prevailed in the Napoleonic War. We also show that the popular notion that today’s emerging markets are breaking new ground in their extensive reliance on domestic debt markets.” There is a view today that both countries and creditors have learned from their mistakes. This brings us to our central theme—the “this time is different syndrome. Africa. Europe. and until not so long ago. Such celebration may be premature.” On a more positive note. Yet the ability of governments and investors to delude themselves. interest rates. an often-cited reason these days why “this time it’s different” for the emerging markets is that governments there are relying more on domestic debt financing. Capital flow/default cycles have been around since at least 1800—if not before. As Kindelberger wisely titled the first chapter of his classic book “Financial Crisis: A Hardy Perennial. extending to Asia. For example. the world is not likely to again see a major wave of defaults. is hardly new. It is not clear how well the institutional innovations noted by North and Weingast (1996) would have fared had Britain been a bit less fortunate in the many wars it fought in subsequent years. our paper at least raises the question of how a country might “graduate” from a history of serial default.
through deeper economic integration. 1260–1913. would mean that Chile could start raising its debt levels if needed (say. the United States can offer the same pull to Latin countries as the European Union has done in its early days. concluding that countries like Hungary and Greece will never default again because “this time is different due to the European Union” may prove a very short-lived truism. In Latin America. These surpluses allowed the country to pay down its external debt to an extremely low level. it is that we cannot jump to “this time is different” conclusions. True graduation. managed to emerge from an extraordinarily checkered bankruptcy history by closer integration with post-war Germany.. to benefit from countercyclical fiscal policy) without quickly slipping back into problems. Chile has seemingly emerged from serial default despite extraordinary debt pressures through the simple expedient of running large and sustained current account surpluses. countries that appear to have escaped a severe history of serial default not only by reforming institutions. 54 . but by benefiting from the anchor of the European Union. nominal / real wages and welfare ratios of building craftsmen and labourers. a process that began even before European integration began to accelerate in the 1980s and 1990s. of course. Mexico is an interesting case where. as well as the North American Free Trade Agreement. the country stands on the verge of graduation thanks to a combination of better monetary and fiscal policy. BIBLIOGRAPHY Allen. Consumer price indices.Interesting recent cases include Greece and Spain. too. It is an interesting question whether. despite profound failure to engage in deep institutional reform. Of course. Robert C. if history tells us anything. Austria. In particular.
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and exports.. 561–579. 1886–1945. These series include prices. inflation and banking crises. multi-century database on public debt and its characteristics and the various manifestations and measurements of economic crises. Tarik M. strengths. and currency crashes and debasements.. For the recent period. For earlier history. Foreign Bonds: An Autopsy. The remainder of this appendix is organized as follows: The first section describes the compilation of the family of time series that are brought together from different major and usually well-known sources. and individual efforts to construct national accounts—notably nominal and real GDP. The remaining two sections are devoted to describing the particulars of building a cross-country. (Philadelphia: Roland Sway Co. 1933). Yousef. Appendix: A Global Database with a Long-term View: Sources and Methodology This appendix presents a broad-brush description of the comprehensive database used in this study and evaluates its main sources. real GDP. Wynne. particularly pre-1900. Those include domestic and external debt defaults. These are series on government finances. II (London: Oxford University Press. William H. Next. Those are devoted to the macroeconomic time series used and the public debt data (which is the centerpiece of our analysis).. we describe the data that is more heterogeneous in both its sources and methodologies. State Insolvency and Foreign Bondholders: Selected Case Histories of Governmental Foreign Bond Defaults and Debt Readjustments Vol. 2002.” Review of Income and Wealth 48.Winkler. 1951). The construction of the public domestic and external debt database can be best described as more akin to archeology than economics. further documentation on the coverage and numerous sources for individual time series by country and by period is provided in Data Appendices I and II. The compilation of 67 . respectively. “Egypt’s Growth Performance Under Economic Liberalism: A Reassessment with New GDP Estimates. modern exchange rates (and earlier metal-based ones). Max. the data are primarily found in standard largescale databases. and limitations. Since the theme of this work is that the devil lurks in the details. we relied on individual scholars or groups of scholars—more details to follow.
19 While our analysis of inflation crises begins in 1500. Since our analysis spans several earlier centuries. many of the price series begin much earlier.crises episodes encompasses both mechanical rules of thumb to date a crisis as well as arbitrary judgment calls on the interpretation of historical events as described by the financial press and scholars over the centuries. we rely on the meticulous work of a number of economic historians who have constructed such price indices item by item. the Historical Statistics of the United States (HSUS .ucdavis. 18 These regional papers provided time series for numerous developing countries for the mid-1800s to pre– WWII.uk/) are key sources. 68 .qeh. inflation became the modern-day version of currency debasement. the scholars participating in the Global Price and Income History Group project at the University of California. Prices Since an overarching theme of our analysis is to document the incidence and magnitude of various forms of expropriation or default through the ages. http://oxlad. For pre–World War II coverage (usually from the early 1900s or late 1800s)..ox. in several “regional” papers). Exchange Rates.edu/) and their counterparts at the Dutch International Institute of Social History (http://www. 19 The complete references by author to this body of scholarly work are given in Appendix I and in the references. To that end.iisg. from primary sources. Following the rise of fiat currency. Currency Debasement.ac. and the Oxford Latin American History Database (OXLAD. I. In this regard. no such study would be complete without taking stock of expropriation through inflation. most often by city rather than by country. For colonial America. cost-of-living indices (as those constructed by Williamson et al. and Real GDP 1. our preferred measures are consumer price indices or their close relative. Global Financial Data (GFD) and Williamson et al. Prices.18 Our data sources for the modern period are primarily the standard databases of the International Monetary Fund—International Financial Statistics (IFS) and World Economic Outlook (WEO).nl/hpw/ ) have been an invaluable source for prices is Europe and Asia. Davis (http://gpih.
at http://home. 1500–1900. rather than the aggregate we seek. as described in Appendix I. Absent any composite index.S. we work with the simple average. the United States and the New World. Exchange rates. 2. and the League of Nations Annual Reports are the primary sources. data. and currency debasement The handmaiden to inflation is. These are sometimes supplemented with scholarly sources for individual countries. as it enforces uniformity—although for the recent period discrepancies across these price indices is. HSUS. We realize that a single commodity (even if it is the most important one) is a relative price. at most. of course. in the 1720s). currency depreciation. so if on any given year we have at least one consumer (or cost-of-living) price series and the price of wheat (or rice)—we do not average the two but give full weight to the composite price index. which are taken from John Castaing's Course of Exchange. OXLAD. for example. trivial.cambridge. On methodology When more than one index is available for a country.S. which appeared twice a week (on Tuesdays and Fridays) from 1698 69 . Less modern are the exchange rates for the late1600s–early1800s for a handful of European currencies. This is most useful when there are price series for more than one city for the same country. When no such consumer price indices are available. This almost always takes the form of wheat prices for Europe and rice prices for Asia. as quantified and documented in detail in Reinhart and Rogoff (2004). modern and early. we turn to wholesale or producer prices indices (as.http://hsus. from 1980 to the present the WEO data dominates all other sources. our primary sources for exchange rates are IFS for official rates and Pick’s Currency Yearbooks for market-based rates. such as in the pre-1800s data. China in the 1800s and the U.comcast. For modern pre-war rates GFD.net/~richardgarner04/) covers key cities in Latin America. we fill in the holes in coverage with individual commodity prices. while Richard Gardner (Economic History Data Desk: Economic History of Latin America. For post–World War II data.org) recently updated the U. Finally.
and its updated version through 2006 by the Total Economy Database (TED http://www. Rodney Edvinsson’s careful estimates for Sweden 1720–2000 or HSUS for the US beginning in 1790 offer a basis on which to examine earlier economic cycles and their relation to crises.net/). Interpolation took three forms. GDP is calculated on the basis of PPP 1990 International Geary–Khamis dollars. series on levels of real GDP. we sometimes found it necessary to interpolate the Maddison data. spanning 1820–2003 (depending on the country). 70 .21 To calculate a country’s share of world GDP continuously over the years.ggdc.20 The earliest series begin in the mid-13th century for Italy and England. etc. the sample represents an even larger share of world GDP (99 percent).throughout the following century or so (see European State Finance Data Base. As we describe in this appendix. we ran auxiliary regressions of the Maddison GDP 20 21 Sevket Pamuk constructs comparable series for Turkey through World War I. 1870. We do not attempt to include in our study aggregate measures of real economic activity prior to 1800. GDP is reported only for selected benchmark years (1820. 3. As the smaller and poorer countries are not in the database. these series are the foundation for dating and quantifying the “debasement crises”—the precursors of modern devaluations.le. When we had actual data for real GDP (from either official sources or other scholars) for periods for which the Maddison data is missing and periods for which both series are available.). TED contains. Real GDP To maintain homogeneity. which lists individual authors). who constructed continuous annual series on the silver content of several European currencies). For most countries. Table AI.ac.html. for up to 125 countries from 1950 to the present. http://www. we employ as a primary source Angus Maddison’s data.uk/hi/bon/ESFDB/frameset. inasmuch as possible for our large sample of countries over the course of approximately 200 years. among other things. and GDP per capita. population. For instance.4.) The earlier “silver-based” exchange rates were calculated by these authors (trivially) from the time series provided primarily by Robert Allen (for other sources see Appendix I. There are exceptions. These countries represent about 96 percent of the world population. 1850. ESFDB. ranging from the best or preferred practice to the most rudimentary.
interpolation simply connected the dots of the missing Maddison data assuming a constant annual growth rate in between the reported benchmark years. useless from the vantage point of discerning any cyclical pattern. Official historical statistics and assorted academic studies listed in Data Appendix I complement the main databases. if no potential regressors were available. Government Finances and National Accounts 1. as this share usually does not change drastically from year to year.edu/faculty/reinhart/PartII_Dual. Reinhart. Trade balances provide a rough measure of the country-specific capital flow cycle—particularly for the earlier periods when data on capital account balances are nonexistent. those accounts can be considered more reliable than many other series of economic activity.publicpolicy. such as an output index or. of course. When no other measures of GDP were available to fill in the gaps. while the earlier data come primarily from GFD and OXLAD. and Végh (2004) and sources cited therein for the more recent period. 4. calculations in the background material to Reinhart and Rogoff (2004). While this method of interpolation is. 71 . for example.23 the external accounts are most often available for longer periods. http://www. This allowed us to fill in the gaps for the Maddison data. most often. The series used in this study are taken from the IMF.pdf.series on the available GDP series for that particular country. The 22 23 It is well known that revenues are intimately linked to the economic cycle. Exports Though subject to chronic misinvoicing problems.umd. Exports are also used to scale debt—particularly external debt. thus maintaining cross-country comparability and enabling us to aggregate GDP by region or worldwide. Public finances Government finances are primarily taken from Mitchell for the pre-1963 period and from Kaminsky. Misinvoicing not withstanding. 22 As a last resort. central government revenues—for which we have long continuous time series. See. II. the auxiliary regressions linked the Maddison measure of GDP to other indicators of economic activity. it still provides a reasonable measure of a particular country’s share of world GDP.
Details on individual country coverage are presented in Appendix Table AI. National Accounts Besides the standard sources. not to mention extensive bibliographical references. Government debt is among the most elusive of economic time series. which brings together the data provided by many authors is an excellent source for the larger European countries for the pre1800 era. such as Brahmananda for India. we have only begun to skim the surface.24 Yet. Richard Bonney’s European State Finance Data Base (ESFDB). In nearly all cases. as regards domestic defaults. it would be relatively straightforward to find a comprehensive long time series on public sector debt. 24 These numbers are a lower bound. are incorporated into our collection. United Nations. 2. Baptista for Venezuela. Public Debt and its Composition One would think that with at least 250 sovereign external default episodes during 1800– 2007 and at least 70 cases of default on domestic public debt (not to mention the significant economic disruption associated with these events). since they do not include the many sovereign defaults prior to 1800 and. which provide data on national accounts for the post–World War II period (with different starting points depending on the country). III. and World Bank. the constructed national account series (usually for pre–World War I) from many scholars around the world. the time series on central government revenues and expenditures date back to the colonial period.web pages of the central banks and finance ministries of the many countries in our sample provide the most up-to-date data. such as the IMF. and Yousef for Egypt. For many of the countries in our sample. the Mitchell data goes back to the 1800s. we consult other multicountry databases such as OXLAD for earlier periods. as it offers considerable detail on government revenues and expenditures. particularly in Asia and Africa. As with other time series used in this study.7. this is not the case—far from it. enabling us to calculate debt-to-revenue ratios for many of the earlier crises. see Reinhart and Rogoff (2008). 72 .
to name a few). 73 . which cannot be considered as much of a time series. external debt is a sufficient statistic on government liabilities. However.” 26 For some countries. unemployment. The most comprehensive data on public debt comes from the World Bank’s Global Development Finance (GFD. but certainly not least.. commodity prices. inflation. The all-country average oscillates between 40 to 80 percent during 1900–2006.For the advanced economies. To state that the IMF’s well-known World Economic Outlook (WEO) database extends to public debt requires a stretch of the imagination. for most countries domestic debt accounts for an important share of total government debt. imports. the most comprehensive data comes from the OECD.K. Korea. we examined the archives of the global institutions’ predecessor. among other things. As Reinhart and Rogoff (2008) illustrate. known previously as the World Debt Tables). Unlike data from the IMF and the World Bank for exchange rates. capital flows. the data actually begins much later in the 1990s. Yet. GFD also has serious limitations. and found that this institution collected information on. since domestic public debt levels are relatively trivial. and the United States. There are no advanced economies included in the database (nor newly-industrialized countries (such as Israel. Greece. prices.26 In search of the elusive data on total public debt. practically all public debt is domestic. this data has several important limitations: it only includes a handful of emerging markets. more. Singapore. for many advanced economies (France. such as Panama or Côte D’Ivoire. which provides time series on general government debt since 1980. with no particulars provided of the composition of debt (domestic versus foreign) or its maturity (long-term versus short-term).. It is an improvement on the other databases in that it begins (for most countries) in 1970 and it provides extensive detail on the particulars of external debt. there is no data prior to 1970. payments balances. Last. government finances. etc. Finland. and only total debt is reported. or Singapore. however. public domestic and external debt in its Statistical Yearbook 25 This description comes from the IMF’s web site: “Download time series data for GDP growth.25 Data is only provided for the G-7 from 1980 onward (out of 180 countries covered in the WEO). these data only cover external debt. and the U. the League of Nations. for that matter) to facilitate comparisons. In a few countries. external debt. such as the Netherlands. exports.
hence it required going to the original publications. This data provides the starting point for our public debt series. Korea. when countries 27 For Australia. we construct a foreign debt series (but. South Africa. and Egypt and Turkey in the 1860s– 1870s. we proceed to approximate the foreign debt stock by reconstructing debt from individual international debt issues. it also disaggregated domestic debt into its long-term and short-term components. among others. and Wynne. Data Appendix II provides details or the sources by country and time period. As former colonies became independent nations. the database expanded accordingly. For the most part. which have been (where possible) extended to the period prior to 1914 and post-1983. When no public debt data is available prior to 1914. the newly-formed United Nations (UN) inherited the data collected by the League of Nations and in 1948 its Department of Economic Affairs. we have put together debt data for much of the colonial period. published a special volume on public debt. these sources yield time series that span 1914– 1983 for the most complete cases. Much of the data come from scholars including Lindert and Morton. It covers advanced and developing economies.28 This exercise allows us to examine standard debt ratios for default episodes for several newly-independent nations in Latin America as well as Greece and important defaults such as that of China in 1921. To the best of our knowledge. among others. 1880–1913. From these data.(1926–1944). Ghana. this data is not available electronically in any database. For data prior to 1914 (including several countries that were then colonies)27. not total debt). While. This debenture data also provide a proximate measure of gross international capital inflows. India. both country-specific statistical and government agencies and individual scholars. Marichal. at which time the domestic and external public debt series were discontinued altogether. These data are most useful for filling holes in the external debt time series. spanning 1914–1946. In total. From that time onwards the UN continued to collect and publish the domestic and external debt data in the same format as their pre-war predecessor on an annual basis in their Statistical Yearbooks. we consulted numerous sources. Miller. 28 Flandreau and Zumer (2004) are an important data source for Europe. neither the IMF nor the World Bank continued this practice after the war. 74 . This practice continued until 1983.
first tap international capital markets.29 For some countries (or colonies in the earlier period) where we have only relatively recent data for total public debt. are the official government sources themselves. the U. and debt restructurings that introduce disconnects between the amounts of debt issued and the subsequent debt stock.and long-term interest rates for the relevant financial center of the time (i. we mostly rely on GFD for external debt. IV. and country-specific key economic and financial indicators for the world’s financial centers during 1800–2007. Special Data Dissemination Standard. For commodity prices.30 To update the data for post-1983. but have reliable data going much further back on central government revenues and expenditures. as there was relatively little private external borrowing nor bank lending in the earlier sample. which are increasingly forthcoming in providing domestic debt data. we calculate and cumulate fiscal deficits to provide a rough approximation to the debt stock. Global variables Global variables (for lack of a better name. indeed. 30 Indonesia prior to 1972 is a good example where this exercise was particularly useful. real and nominal GDP. Two very valuable recent studies facilitate the update: Jeanne and Guscina (2006) compile detailed date on the composition of domestic and external debt for 19 important emerging markets for 1980–2005. prior to World War I and the U. 75 . they continue to be a useful measure of gross capital inflows. global in scope—namely. and short. subsequently). V. since this term is of fairly recent vintage) have two components: those indicators that are.S. Levy-Yeyati. Last. Varieties of Economic Crises and their Dates 29 Even under these circumstances. Their usefulness (as measures of debt) is acutely affected by repeated defaults. often under the IMF’s 1996 initiative.. but certainly not least. The key economic indicators include the current account deficit. world commodity prices.e. we have time series since the late 1700s from four different sources (see Data Appendix I). Cowan.K. Panizza. Sturzenegger (2006) perform a similar exercise for all the developing countries of the Western hemisphere for 1980–2004. write-offs.
1. Thus. Furthermore. In this study. we used two approaches. inflation rates well below 40 percent per annum were considered as inflation crises. as it does not rely on other variables such as reserve losses and interest rate hikes. we used a 12-month inflation threshold of 40 or higher percent to define a “freely falling” episode. with Hungary 1946 holding the record in our sample. debasement. Details follow. we adopt an inflation threshold of 20 percent per annum. Currency crashes To date currency crashes. Crises defined by quantitative thresholds: currency crashes. we follow a variant of Frankel and Rose (1996).5 for 1500–1799. 1999) but with the full period in which annual depreciations exceed the threshold. who focus exclusively on the exchange rate depreciation. which classified exchange rate arrangements for the post–World War II period.71 for 1800–1913. which spans a much longer period before the widespread creation of fiat currency. This approach is similar to that followed in Kaminsky and Reinhart (1999). who used quantitative thresholds to date currency crises and events to date banking crises. Hardly surprising. and inflation Inflation crises Since we want to study the incidence of expropriation in its various forms.To identify crisis episodes. In our earlier work (Reinhart and Rogoff. the largest crashes shown in Table A1 are 76 . we are not only concerned here with the dating of the initial crash (as in Frankel and Rose. Mirroring our treatment of inflation episodes. 0. and 5. hyperinflations are of modern vintage. Median inflation rates before World War I were well below those of the more recent period: 0. 2004). one is quantitative in nature while the other is based on a chronology of events. as the last column of Table A1 highlights. 1996 and Kaminsky and Reinhart.0 for 1914–2006. Many of the high-inflation spells can be best described as chronic—lasting many years. This definition is the most parsimonious. we are not only interested in dating the beginning of an inflation or currency crisis episode but its duration as well.
77 . The “honor” of the record currency crash. goes to Greece in 1944. however.similar in timing and orders of magnitudes as the inflation profile.
which depicts the track record for Russia and Austria during the Napolenic Wars.8 –55.1 159. An annual depreciation versus the US dollar (or the relevant anchor currency—historically the UK pound. Such conversions form a part of every hyperinflation episode in our sample. in its struggle with hyperinflation. in effect. when it comes to the magnitude of a single conversion. drastic reductions in the silver content of the currency provided many sovereigns with their most important source of financing. Finally.Table A1. A currency reform where a new currency replaces a much-depreciated earlier currency in circulation. the record holder is China in 1948. However.6 9. Conversions also follow spells of high (but not necessarily hyper inflation). A reduction in the metallic content of coins in circulation of 5 percent or more. 78 . the French franc. or the German DM and presently the euro) of 15 percent or more. Period 1500–1790 1800–1913 1914–2006 1800–1913 1914–2006 Maximum 173. For example. Defining Crises: A Summary of Quantitative Thresholds Crisis type Inflation Threshold An annual inflation rate 20 percent or higher. Debasements were particularly frequent and large during wars. Figure A1.0 The most extreme episode in our sample is the 1948 Chinese conversion at a rate of 3 million to 1. We also examine separately the incidence of more extreme cases where inflation exceeds 40 percent per annum. with a conversion rate of three-million to one.63E+26 Currency crashes 275. Currency debasement The predecessor of modern inflation and foreign exchange rate crises was currency debasement during the long era when the principal means of exchange were metallic coins. Brazil had no less than four conversions from 1986 to1994. and these cases are also included in our list of modern debasements. it is not unusual to have several conversions in quick succession. Indeed. we also date currency “reforms” or conversions and their magnitudes.7 3.37E+09 Currency debasement: Type I Currency debasement: Type II 1258–1799 1800–1913 –56. is indeed representative of many more episodes.
Figure A1.31 2. our analysis stresses events. Crises defined by events: banking crises and domestic and external debt defaults In this section. 79 . and their little known or understood domestic debt crises counterparts. but we do not encompass such episodes in this study and leave it for future research. Changes in the Silver Content of the Currency: Austria and Russia During the Napolenic Wars. Banking Crises With regard to banking crises. 1799-1815 1765 20 Russian ruble 1770 1775 1780 1785 1790 1795 1800 1805 1810 1815 10 0 -10 i Per cent -20 -30 -40 Austrian kreuze r -50 -60 The same quantitative methodology could be applied to date the burst of asset price bubbles (equity or real estate) that are so commonplace in the run-up to banking crises. we describe the criteria used in this study to date banking crises. external debt crises. The main reason for following this approach has to do with the lack of long time series data that allows us to date banking or 31 See Kaminsky and Reinhart (1999) for the construction of thresholds to date equity price crashes and Reinhart and Rogoff (2008) for a depiction of the behavior of real estate prices on the eve of banking crises in industrialized economies.
however. particularly for the earlier part of our sample as well as for developing countries (where many domestic banks do not have publicly traded equity). for Peru. the comprehensive and well-known study by Caprio and Klingebiel—which the authors updated through 2003—is 80 . or takeover by the public sector of one or more financial institutions (as in Venezuela in 1993 or Argentina in 2001). merging. Often. this is problematic. We rely on existing studies of banking crises and on the financial press. a large increase in bankruptcies or nonperforming loans could be used to mark the onset of the crisis. but the main sources for cross-country dating of crises are as follows: For post-1970. be it from a collapse in real estate prices or increased bankruptcies in the nonfinancial sector. This indicator would have certainly done well in dating the numerous banking panics of the 1800s. Many country-specific studies (such as Camprubi. for China. but from a protracted deterioration in asset quality. and (2) if there are no runs. for Mexico) pick up banking crisis episodes not covered by the multicountry literature and contribute importantly to this chronology. and McElderry. the banking problems do not arise from the liability side. Cheng. If the beginning of a banking crisis is marked by bank runs and withdrawals. For example. takeover. 1957. merging. that marks the start of a string of similar outcomes for other financial institutions (as in Thailand 1996–97). according to these studies the fragility of the banking sector was widespread during these periods. 2003. the latter are also made less informative by banks’ desire to hide their problems for as long as possible. we mark a banking crisis by two types of events: (1) bank runs that lead to the closure. Given these data limitations. 1976. 2002. In this case. or large-scale government assistance of an important financial institution (or group of institutions). the closure. Indicators of business failures and nonperforming loans are also usually available sporadically. However. and Noel. if at all. then changes in bank deposits could be used to date the crises. the relative price of bank stocks (or financial institutions relative to the market) would be a logical indicator to examine.financial crises quantitatively along the lines of inflation or currency crashes.
authoritative, especially when it comes to classifying banking crises into systemic or more benign categories; Kaminsky and Reinhart (1999), and Jacome (2008) for Latin America round out the sources. For pre–World War II, Kindleberger (1989), Bordo et al. (2001), and Willis (1926) provide multicountry coverage on banking crises. We relegate a summary discussion of the limitations of this event-based dating approach to Table A2, while the years in which the banking crises began are listed in Table A3—unfortunately, for many of the early episodes it is difficult to ascertain how long the crisis lasted.
Table A2. Defining Crises by Events: A Summary
Type of Crisis Definition and/or Criteria We mark a banking crisis by two types of events: (1) bank runs that lead to the closure, merging, or takeover by the public sector of one or more financial institutions; and (2) if there are no runs, the closure, merging, takeover, or large-scale government assistance of an important financial institution (or group of institutions), that marks the start of a string of similar outcomes for other financial institutions. A sovereign default is defined as the failure to meet a principal or interest payment on the due date (or within the specified grace period). The episodes also include instances where rescheduled debt is ultimately extinguished in terms less favorable than the original obligation. The definition given above for external debt applies. In addition, domestic debt crises have involved the freezing of bank deposits and or forcible conversions of such deposits from dollars to local currency. Comments This approach to dating the beginning of a banking crisis is not without drawbacks. It could date a crisis too late, because the financial problems usually begin well before a bank is finally closed or merged; it could also date a crisis too early, because the worst part of a crisis may come later. Unlike the external debt crises (see below), which have well-defined closure dates, it is often difficult or impossible to accurately pinpoint the year in which a crisis ended. While the time of default is accurately classified as a crisis year there are a large number of cases where the final resolution with the creditors (if it ever did take place) seems interminable. Fort his reason we also work with a crisis dummy that only picks up the first year. There is at best some partial documentation of recent defaults on domestic debt provided by Standard and Poors. Historically, it is very difficult to date these episodes and in many cases (like banking crises) it is impossible to ascertain the date of the final resolution.
Banking crisis Type I: systemic/severe Type II: financial distress/ milder
Debt crises: External
Debt crisis: Domestic
External Debt Crises External debt crises involve outright default on payment of external debt obligations (Argentina 2001 holds the record for the largest default), repudiation (as in Mexico 1867, when an over 100 million pesos of debt, issued by Maximillian, was repudiated by the Juarez government), or the restructuring of debt into terms less favorable to the lender than those in the original contract (for instance, India’s little-known external restructurings in 1958–1972. These events have received considerable attention in the academic literature from leading modern-day economic historians, such as Michael Bordo, Barry Eichengreen, Marc Flandreau, Lindert and Morton, and Alan Taylor.32 Relative to early banking crises (not to mention domestic debt crises—which have been all but ignored in the literature) much is known about the causes and consequences of these rather dramatic episodes. The dates of sovereign defaults and restructurings are those listed in Tables 2–5. For post-1824, the dates come from several Standard and Poors studies. However, these are incomplete, missing numerous post-war restructurings and early defaults so this source has been supplemented with additional information from Lindert and Morton (1989), MacDonald (2003), Purcell and Kaufman (1993), Suter (1992), and Tomz (2007). Of course, required reading in this field includes Winkler (1933) and Wynne (1951). Methodology While the time of default is accurately classified as a crisis year there are a large number of cases where the final resolution with the creditors (if it ever did take place) seems interminable. Russia’s default following the revolution holds the record, lasting 69 years. Greece’s default in 1826 shut it out from international capital markets for 53 consecutive years, while Honduras’s 1873 default had a comparable duration.33 Looking at the full default episode is, of course, useful for characterizing the borrowing/default cycles, calculating hazard rates, etc. But it is hardly credible that a spell of 53 years could be considered a crisis—even if they weren’t exactly prosperous years. Thus, in addition to constructing the country-specific dummy variables to cover the entire episode,
This is not meant to be an exhaustive list of the scholars that have worked on historical sovereign defaults. At present, Honduras remains in default since 1981, 27 years.
we also employ two other qualitative variables. The first of these only enters as a crisis the year of default; while the second creates a seven-year window centered on the default date. The rationale is that neither the three years that precede a default nor the three years that follow it can be considered a “normal” or “tranquil” period. As in Reinhart and Rogoff (2008), this allows us to analyze the behavior of various economic and financial indicators surrounding the crisis. Domestic Debt Crises Information on domestic debt crises is scarce but it is not because these crises do not take place. Indeed, as Reinhart and Rogoff (2008) show, domestic debt crises typically take place against much worse economic conditions than the average external default. Usually domestic debt crises do not involve external creditors, perhaps this may help explain why so many episodes go unnoticed. Of course, this is not always the case, Mexico’s much-publicized near-default in 1994– 1995 would have been a “famous” domestic default crisis indeed, since the dollar-linked government debt, the Tesebonos, that were on the verge of default, were issued under domestic law and were part of domestic debt. One can only speculate that if the Tesobonos had not been so widely held by nonresidents, perhaps this crisis would have received less attention. Since 1980, Argentina has defaulted three times on its domestic debt—the two defaults that coincided with defaults in external debt (1982 and 2001) did attract considerable international attention. The largescale 1989 default that did not involve a new default on external debt and did not involve nonresidents is scarcely known in the literature. Even the many defaults on domestic debt during the Great Depression in advanced economies and developing ones are not well documented. Another feature that characterizes domestic defaults is that references to arrears or suspension of payments on domestic debt are often relegated to footnotes. Lastly, some of the domestic defaults that involved the forcible conversion of foreign currency deposits into local currency have occurred during banking crises, hyperinflations, or a combination of the two (Bolivia, Peru, and Argentina are in this list).
The approach toward constructing categorical variables follows that previously described for external debt default. Like banking crises and unlike external debt defaults. for many episodes of domestic default the endpoint for the crisis is not well known. 84 .
1800-1879 France France UK UK Denmark US UK. UK Austria. US 1914 Chile Mexico Argentina. Netherlands. Chile. Banking Crises Dates and Capital Mobility: 1800-2007 High-Income Country (ies) BeginningYear Middle Income Country (ies) BeginningYear Low Income Country (ies) BeginningYear Capital Mobility: Low-Moderate. UK. US US Canada. Italy. France. US 1802 1805 1810 1815 1813 1818 1825 1836 1837 1847 1848 1857 1866 1873 India Peru South Africa 1873 1877 1863 Capital Mobility: High. US Germany. 1880-1914 Germany France US Denmark Italy France Portugal. 1915-1919 Chile 1915 85 . Brazil 1908 1913 1914 India 1913 Capital Mobility: Low. Japan. Brazil. Portugal Australia Netherlands. Italy.Table A3. US 1880 1882 1884 1885 1887 1889 1890 Mexico 1883 Argentina. France. Japan Denmark. Sweden. UK. South Africa 1890 1891 1893 1897 1898 1900 1901 1907 Chile Brazil 1899 1900 Mexico 1907 Belgium. UK UK Belgium UK. US Italy. Sweden Norway Finland Germany. Japan. Norway. Italy.
Taiwan US 1920 1921 Capital Mobility: Moderate. Spain. Japan. 1930–1969 France. Netherlands. Greece. Israel.Table A3. Taiwan Austria Belgium. Mexico 1929 India 1929 Capital Mobility: Low. Norway Canada. Banking Crises Dates and Capital Mobility: 1800–2007 (continued) High Income Country (ies) BeginningYear Middle Income Country (ies) BeginningYear Low Income Country (ies) BeginningYear Portugal Finland. Brazil. Germany. 1920–1929 Mexico 1920 India 1921 1923 1924 1925 1927 1929 China 1923 Brazil. Germany Japan. Spain 1974 1977 Capital Mobility: Moderate. Italy Belgium. China Brazil 1934 1937 India Brazil 1963 1947 UK Germany. Sweden Belgium Italy Belgium. China 1931 1934 1935 1939 Argentina. Italy. 1970–1979 Uruguay 1971 Chile 1976 Central African Republic South Africa 1977 Venezuela 1978 1976 86 . Chile 1926 Brazil. Finland 1930 1931 Argentina. Finland. Portugal.
). Estonia. Cote D’Ivoire. Kirgyz Republic. Senegal 1986 1987 1988 Australia 1989 Italy 1990 Czech Republic. Malaysia Denmark. Kenya 1982 1983 1984 1984 1985 1987 1988 Bangladesh. Kenya. Singapore Canada. Thailand Argentina. Korea. Mali. Mozambique. Chile. Liberia. Eritrea. Finland. India. BosniaHerzegovina. 1981 Mexico. Slovak Republic Albania. China. Brazil. Costa Rica. Egypt. UK Japan 1991 1992 Slovenia. Panama 1985 Low Income Country (ies) BeginningYear Hong Kong. Indonesia Cape Verde. Norway 1987 Bolivia. Hungary. El Salvador. Rep. Togo 1993 87 . Congo. Philippines Uruguay Colombia. Banking Crises Dates and Capital Mobility: 1800-2007 (continued) High-Income Country (ies) BeginningYear Middle Income Country (ies) BeginningYear Capital Mobility: High. Ghana Equatorial Guinea. Macedonia Argentina. Sri Lanka Algeria. Romania Georgia. Cameroon. Peru. 1980-2007 1980 Argentina. 1982 Turkey 1983 Morocco. Ecuador. New Zealand. Venezuela 1989 1990 Sierra Leone 1990 1991 Djbouti. Niger Mauritania Guinea. Egypt. Nigeria 1992 1993 Guinea. Poland. Sao Tome 1991 1992 Angola. Chad. Kuwait Taiwan UK. Sweden. Burkina Faso. Madagascar. Nicaragua Lebanon. US 1982 1983 Congo (Dem. South Africa. Central African Republic. Greece.Table A3. Nepal. Brazil. Tanzania Benin.
Ukraine Colombia. Philippines. 1994 Bolivia. 1980–2007 Armenia. El Salvador Russia Bolivia. Cameroon. Jamaica. Mexico. Russia. Thailand Indonesia. Latvia. Peru Nicaragua 2000 Argentina. Azerbaijan. Croatia. Congo (Rep. Banking Crises Dates and Capital Mobility: 1800–2007 (continued) High Income Country (ies) BeginningYear Middle Income Country (ies) BeginningYear Capital Mobility: High.). Paraguay. Costa Rica. Uganda 1994 UK 1995 Guinea-Bissau. Swaziland. Zimbabwe 1995 Myanmar Yemen Vietnam 1996 Taiwan 1997 1997 US 2007 88 . Turkey 1995 Argentina. Brazil. 1998 Ecuador. Lithuania. 2001 Guatemala Paraguay 2002 Uruguay Dominican 2003 Republic Guatemala 2006 Low Income Country (ies) BeginningYear France 1994 Burundi. Mauritius. 1999 Honduras. 1997 Korea. Bulgaria. Zambia. 1996 Ecuador. Malaysia.Table A3.
5 Nominal and Real Gross National Product and Output Index Table AI. IMF List of Tables Table AI.1 Prices: Consumer or cost-of-living indices Table AI. al) ESFDB: European State Finance Data Base GFD: Global Financial Data GPIHG: Global Price and Income History Group IISH: International Institute of Social History IFS: International Financial Statistics.4 Silver Content of Currencies Table AI.8 Total Exports and Imports Table AI.7 Central Government Expenditure and Revenue Table AI. Abbreviations of Frequently-used Sources (Additional sources listed in tables below) DIA: Diaz (et.2 Modern Nominal Exchange Rates Table AI. IMF. and Vegh MAD: Maddison MIT: Mitchell OXF: Oxford Latin American History Database RR: Reinhart and Rogoff TED: Total Economy Database WEO: World Economic Outlook. while a separate appendix is devoted to the database on government debt.Data Appendix I. KRV: Kaminsky.6 Gross National Product: PPP in constant dollars Table AI. Macro Time Series This data appendix covers the macro time series used. 9 Global Indicators and Financial Centers 89 .3 Early Silver-based Exchange Rates Table AI. Reinhart.
Flandreau & Zumer GFD/WEO Allen GFD/WEO GFD/WEO Garner Williamson et. al. 1 Prices: Consumer or cost-of-living indices (unless otherwise noted) Country Algeria Angola Argentina Period covered 1869-1884 1938-2007 1914-1962 1991-2007 1775-1812 1864-1940 1884-1913 1900-2000 1913-2000 1913-2007 1818-1850 1850-1983 1861-2007 1440-1800 1800-1914 1880-1913 1919-2007 1462-1913 1835-2007 1936-2007 1763-1820 1830-1937 1861-2000 1912-2007 1867-1975 1910-2007 1956-1993 1980-2007 1754-1806 1810-2000 1900-2000 1913-2007 1500-1910 1638-1936 1867-1935 1926-1948. Flandreau & Zumer OXF Diaz et. al. al. GFD/WEO CanStat GFD/WEO MIT WEO Garner Diaz e. GFD/WEO OXF WEO GFD/WEO Commentary Wheat prices Buenos Aires only Australia New Wales. al. 1978-2007 1863-1940 1900-2000 1923-2007 1937-2007 1951-2007 1748-1800 1815-2007 1942-2000 1980-2007 1939-2007 Sources Hoffman et. OXF GFD/WEO Peng Wang Hsu GFD/WEO Williamson et.Table AI. Vanplew. GPIHG Shergold. al. al. food Vienna Wheat prices Austria Belgium Bolivia Brazil Antwerp Rio de Janeiro only Rio de Janeiro only Canada Central African Republic Chile Santiago only China Rice prices Rice prices Wholesale prices Colombia Costa Rica Cote D’Ivoire Denmark Dominican Republic Ecuador Wheat prices 90 . al. OXF GFD/WEO GFD/WEO GFD/WEO Hoffman et. GFD/WEO Butlin. al. GFD/WEO MIT WEO Gardner Williamson et. Diaz et. al. food prices Sidney. GPIHG GFD/WEO Allen Hoffman et.
al. al. al. Milan Rice prices in the southern region of Korea Korea Japan Kenya Malaysia Mauritius 1906-1939 1948-2007 1600-1650 1818-1871 1860-1935 1900-2007 1947-2007 1948-2007 1946-2007 Williamson et. al. GFD/WEO GFD/WEO OXD WEO OXD WEO GFD/WEO Diaz et.Table AI. GFD/WEO Kimura Bunko Williamson et. GFD/WEO GFD/WEO GFD/WEO GFD/WEO Rice prices. GFD/WEO Williamson et.1 Prices: Consumer or cost-of-living indices-continued (unless otherwise noted) Country Egypt Period covered 1859-1941 1913-2007 1915-1999 1937-2000 1980-2007 1860-2001 1980-2007 1431-1786 1840-1913 1807-1935 1840-2007 1427-1765 1637-1855 1820-2007 1833-1938 1922-2007 1949-2007 1938-2000 1980-2007 1938-2000 1980-2007 1923-2007 1866-2000 1873-1939 1913-2007 1820-1940 1948-2007 1548-1645 1734-1806 1701-1860 1861-2007 1690-1909 Sources WILL GFD/WEO GFD OXD WEO Finnish Historical National Accounts WEO Allen Dick GFD/WEO Allen Hoffman et. al. al. al. Osaka Rice prices. Williamson et. Osaka 91 . GFD/WEO Allen DeMaddalena GFD/WEO Jun & Lewis Retail prices Munich Wheat prices GDP deflator Commentary El Salvador Finland France Germany Greece Ghana Guatemala Honduras Hungary India Indonesia Italy Naples Wheat prices. GFD/WEO Kostelenos et.
al. al. eggs. 1991-2007 1948-2007 1895-2007 1500-1650 1651-1800 1800-2000 1980-2000 1939-2007 Sources Garner Williamson et. al. WEO Borodkin Flandreau & Zumer GFD/WEO GFD/WEO GFD/WEO Hamilton Hamilton. al. 1927-1940. WEO Hoffman et. and linen prices Sri Lanka 92 . al. al. al. GFD/WEO Hoffman et. Petesburg Singapore South Africa Spain Valencia Wheat. 1944-1972. WEO Williamson et. al. Allen GFD/WEO Hoffman et. GFD/WEO Van Zanden Van Riel GFD/WEO Statistics New Zealand WEO GFD/WEO GFD/WEO Grytten WEO OXD WEO GFD/WEO Garner Garner Diaz et.Table AI. Hoffman et. St. Diaz et. Bordo et. al. al. WEO GFD/WEO Commentary Zacatecas Morocco Myanmar (Burma) Netherlands New Zealand Nicaragua Nigeria Norway Panama Paraguay Peru Potosi Lima Philippines Poland Oats Prices-Warsaw Warsaw Portugal Wheat prices Romania Russia Wheat prices. Wallachia Wheat and rye flour. GFD/WEO GFD/WEO Williamson et.1 Prices: Consumer or cost-of-living indices-continued (unless otherwise noted) Country Mexico Period covered 1786-1821 1877-1940 1918-2007 1939-3007 1870-1940 1939-2007 1500-1800 1800-1913 1880-2007 1857-2004 1980-2007 1937-2007 1953-2007 1516-2005 1980-2007 1939-2000 1980-2007 1938-2007 1750-1816 1790-1841 1800-1873 1913-2000 1980-2007 1899-1940 1937-2007 1701-1815 1816-1914 1921-1939 1983-2007 1728-1893 1881-1997 1980-2007 1779-1831 1971-2007 1853-1910 1880-1913 1917-1924.
Table AI. al. al. WEO Williamson et. al.1 Prices: Consumer or cost-of-living indices-concluded (unless otherwise noted) Country Sweden Period covered 1732-1800 1800-2000 1980-2007 1897-1939 1980-2007 1820-1941 1948-2007 1939-2007 1469-1914 1854-1941 1922-2007 1450-1999 1781-2007 1720-1789 1774-2003 1980-2007 Uruguay 1870-1940 1929-2000 1980-2007 1830-2002 1914-2007 1938-2007 1920-1970 1930-2007 Sources Hoffman et. Edvinsson WEO Williamson et. GFD/WEO GFD/WEO Pamuk Williamson et. OXF WEO Baptista GFD/WEO GFD/WEO Mitchell GFD/WEO Commentary Wheat prices Taiwan Thailand (Siam) Tunisia Turkey Istanbul United Kingdom United States Southern England Wholesale prices Venezuela Zambia Zimbabwe 93 . al. GFD/WEO Van Zanden GFD/WEO Historical Statistics of the United States Historical Statistics of the United States WEO Williamson et. al.
German DM Austrian schilling UK pound Dutch guilder UK pound.Table AI. al. French franc 94 . German DM French francs UK pound UK pound French francs UK pound UK pound UK pound UK pound. German DM UK pound UK pound Japanese yen UK pound UK pound UK pound. Picks IFS GFD/IFS GFD/IFS GFD/IFS ESTDB/Course of the Exchange GFD/IFS ESTDB/Course of the Exchange GFD/IFS Lazaretou GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD Other relevant rates French francs/euro French francs UK pound UK pound. German DM UK pound Germany Greece Guatemala Honduras Hungary India Indonesia Italy Japan Kenya Korea Malaysia Mauritius Mexico UK pound. GFD/IFS GFD/IFS OXF GDF/IFS GDF/IFS GDF/IFS GDF/IFS OXF. German DM UK pound German DM UK pound UK pound.2 Modern Nominal Exchange Rates (Domestic currency units per US dollar and other currencies noted) Country Algeria Angola Argentina Australia Austria Belgium Bolivia Brazil Canada Central African Republic Chile China Colombia Costa Rica Denmark Dominican Republic Ecuador Egypt El Salvador Finland France Period covered 1831-2007 1921-2007 1880-1913 1885-2007 1835-2007 1814-2007 1830-2007 1863-2007 1812-2007 1858-2007 1900-2007 1830-1995 1878-2007 1848-2007 1900-2000 1919-2007 1921-2007 1864-2007 1905-2007 1898-2000 1980-2007 1869-2007 1870-2007 1900-2007 1619-1810 1800-2007 1698-1810 1795-2007 1872-1939 1901-2007 1900-2007 1870-2007 1900-2007 1823-2007 1876-2007 1816-2007 1862-2007 1898-2007 1905-2007 1900-2007 1900-2007 1814-2007 1823-1999 Source GFD/IFS GFD/IFS Flandreau & Zumer GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS Braun et.
German DM Argentine peso UK pound Spanish peseta Dutch grooten UK pound. Japanese yen UK pound French franc UK pound French franc United States Uruguay Venezuela Zambia Zimbabwe UK pound UK pound 95 .Table AI. German DM French franc New Zealand Nicaragua Nigeria Norway Panama Paraguay Peru Philippines Poland Portugal Romania Russia Singapore South Africa Spain Sri Lanka Sweden Taiwan Thailand (Siam) Tunisia Turkey United Kingdom UK pound UK pound German DM UK pound UK pound.2 Modern Nominal Exchange Rates-concluded (Domestic currency units per US dollar and other currencies noted) Country Morocco Myanmar (Burma) Netherlands Period covered 1897-2007 1900-2007 1698-1810 1792-2007 1892-2007 1912-2007 1900-2007 1819-2007 1900-2007 1900-2000 1980-2007 1883-2007 1893-2007 1916-2007 1750-1865 1794-2007 1921-2007 1815-2007 1814-2007 1900-2000 1834-2007 1900-2007 1814-2007 1900-2007 1814-2007 1895-2007 1859-2007 1900-2007 1859-2007 1619-1810 1660-2007 1660-2007 1900-2007 1900-2007 1900-2007 1900-2007 Source GFD/IFS GFD/IFS ESTDB/Course of the Exchange GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS OXD IFS GFD/IFS GFD/IFS GFD/IFS Course of the Exchange GDF/IFS GDF/IFS GFD/IFS GFD OXF/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GDF/IFS GDF/IFS GFD/IFS GFD/IFS GFD/IFS ESTDB/Course of the Exchange GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS GFD/IFS Other relevant rates French franc/euro UK pound UK pound German DM UK pound UK pound Swedish krona. German DM UK pound.
4 Silver Content of Currencies Country Austria Belgium France Germany Italy Netherlands Portugal Russia Spain Period Covered 1371-1860 1349-1801 1258-1789 1350-1798 1417-1830 1289-1858 1366-1575 1450-1800 1750-1855 1761-1840 1761-1815 1351-1650 1501-1800 1630-1809 1523-1573 1555-1914 1261-1918 1800-1979 Sources Allen & Unger Korthals Allen & Unger Allen & Unger Malanima Allen & Unger Van Zanden Godinho Lindert.Table AI. Table A4 RR. New Castille Real mark ortug Akche Pence Dollar Sweden Turkey United Kindgom United States Montfort Soderberg Ozmukur & Pamuk Allen & Unger Allen & Unger 96 . Table A4 RR. Vienna Hoet livre tournois composite pfenning lira fiorentina Composite Reis common ruble Composite mark ortug Akche Table AI. Table A4 RR. Table A4 RR. Valencia vellon maravedis.3 Early Silver-based Exchange Rates (Domestic currency units per UK pence) Country Austria Belgium France Germany Italy Netherlands Portugal Russia Spain Sweden Turkey Period Covered 1371-1860 1349-1801 1258-1789 1350-1830 1289-1858 1366-1800 1750-1855 1761-1840 1351-1809 1523-1573 1555-1914 Source RR. Table A4 Currency/Commentary kreuzer. Vienna Hoet livre tournois pfenning/Frankfurt pfenning/Augsburg lira fiorentina Flemish grote Guilder Reis common ruble Assignatzia dinar. Table A4 RR. Table A4 RR. Table A4 RR. Table A4 RR. Table A4 RR. Mironov Allen & Unger Currency/Commentary kreuzer. Table A4 RR.
al. al. al. Index of total production (1995=100) 1962-1999 1900-2000 1925-1999 1947-1999 1818-1975 GFD OXF GFD GFD Nordic Historical National Accounts Real. Flandreau & Zumer GFD GFD 97 . OXF GFD/WEO GFD/WEO Diaz.Table AI. Nominal Index of total production (1995=100) Real (base=1970) Nominal Index of total production (1995=100) Nominal Commentary Australia Austria Belgium Bolivia Brazil 1835-2007 BNB.et. OXF 1861-2007 1850-2000 1900-2000 Nominal Index of total production (1995=100) (base=1970) Canada Central African Republic Chile China NNP Colombia Costa Rica Cote D’ Ivoire Denmark Dominican Republic Ecuador Egypt 1810-2000 Diaz et. (base=1970) 1886-1945 1952-2007 1821-1859 1860-2001 Yousef GFD/WEO Landes Nordic Historical National Accounts Cotton output El Salvador Finland France Germany Greece GNI Guatemala Honduras 1833-1939 1880-1913 1927-1999 1948-1999 Kostelenos et. Centre d'études économiques de la KUL GFD/WEO Diaz et. al. al.5 Nominal and Real Gross National Product and Output Index (Domestic currency units) Country Algeria Angola Argentina Period covered 1950-2007 1962-2007 1969-2007 1884-1913 1875-2000 1900-2000 1900-2007 1798-2007 1820-2000 Source GFD/WEO/IFS GFD/WEO/IFS Flandreau & Zumer Diaz et.
1945-1995 1979-1997 1992-1999 1911-1999 1900-1970 1720-2000 1800-2000 1910-1970 Flandreau & Zumer GFD GFD GFD GFD Bassino and Van der Eng Edvinsson Bassino and Van der Eng GFD/WEO Bassino and Van der Eng Nominal Production Real.GNI also calculated Mexico Index of total production (1995=100) Real.Table AI. 1951-1999 1911-1938. per capita Nominal and real 1946-2007 1910-1970 98 . al.5 Nominal and Real Gross National Product and Output Index (Domestic currency units) Country India Period covered 1900-1921. 1953-1999 Korea GNI Malaysia 1911-1940 1953-1999 1910-1970 1949-1999 1820-2000 1900-2000 1900-2000 1925-1999 1913-1970 1950-1999 1800-1913 1830-2003 1900-2000 1900-2000 1942-1999 1910-1970 1946-2997 Poland Portugal Russia GNI Source GFD/WEO Brahamanda Diaz et. VanZanden Bassino and Van der Eng GFD GFD Myun Soo Cha and Nak Kim GFD Bassino and Van der Eng GFD DIA OXF OXF GFD Bassino and Van der Eng GFD National Accounts of the Netherlands Grytten OXF OXF GFD Bassino and Van der Eng GFD/WEO Commentary Indonesia Real. 1948-2007 1861-1899 1820-2000 1815-1913 1910-1970 1921-1939. per capita Index of total production Java Thousand yen. (base=1970) Myanmar (Burma) Netherlands Norway Peru Real (base=1970) Nominal Philippines South Africa Spain Sri Lanka Sweden Taiwan Thailand (Siam) 1885-1913 1928-1940.
Table AI.5 Nominal and Real Gross National Product and Output Index (Domestic currency units) Country Tunisia Turkey United Kingdom United States 1923-2005 1950-1999 1830-1999 1948-1999 1790-2002 1948-1999 1935-1999 1955-2000 1900-2000 1955-1999 1830-2002 1900-2000 1950-2007 Nominal GFD GFD GFD Historical Statistics of the United States GFD GFD OXF OXF GFD Baptista OXF GFD/WEO GNI Real. per capita Period covered Source Commentary Uruguay Real (base=1970) GNI Venezuela Real (base=1970) Zambia Zimbabwe 99 .
Al. al MAD/TED RR MAD/TED MAD/TED RR MAD/TED RR MAD/TED RR DIA MAD/TED RR MAD/TED RR MAD Diaz et.Table AI. MAD/TED MAD/TED MAD/TED MAD/TED MAD/TED MAD/TED RR MAD/TED OXF RR MAD/TED RR OXF MAD/TED RR MAD/TED MAD/TED RR MAD/TED RR MAD/TED MAD/TED MAD/TED RR Commentary Interpolation 1821-1949 (base=1996) Interpolation 1871-1899 Australia Austria Belgium Bolivia Brazil Interpolation 1821-1869 Interpolation 1821-1845 Interpolation 1936-1944 (base=1996) Interpolation 1821-1869 Interpolation 1821-1869 Canada Central African Republic Chile China Colombia Costa Rica Denmark Dominican Republic Ecuador (base=1996) Interpolation 1942-1949 (base=1970) Interpolation 1900-1938 Interpolation 1821-1949 (base=1970) Interpolation 1821-1859 Egypt El Salvador Finland France Germany Greece Guatemala Honduras Hungary Interpolation 1821-1849 Interpolation 1821-1920 Interpolation 1871-1923 100 .6 Gross National Product: PPP in constant dollars (also available on a per capita basis) Country Algeria Angola Argentina Period covered 1950-2005 1820-2005 1950-2005 1875-2000 1900-2005 1870-2005 1820-2006 1870-2006 1820-2006 1846-2006 1820-2006 1945-2005 1936-2005 1820-2000 1870-2005 1820-2005 1870-2006 1820-2006 1950-2003 1810-2000 1820-2005 1929-1938 1950-2006 1900-2005 1920-2005 1820-2006 1950-2005 1942-2005 1939-2005 1900-2000 1900-2005 1950-2005 1820-2005 1900-2000 1860-2006 1820-2006 1820-2006 1850-2006 1820-2006 1921-2006 1820-2006 1920-2005 1920-2005 1824-2006 1870-2006 Source MAD/TED RR MAD/TED Diaz et.
Table AI.6 Gross National Product: PPP in constant dollars (also available on a per capita basis) Country India Indonesia Japan Kenya Korea Malaysia Mauritius Mexico Morocco Myanmar (Burma) Panama Paraguay Peru Philippines Poland Period covered 1884-2006 1820-2006 1870-2005 1820-2005 1870-2006 1820-2006 1950-2005 1911-2006 1820-2006 1911-2005 1820-2006 1950-2005 1900-2006 1820-2006 1950-2005 1820-2005 1950-2005 1820-2005 1945-2005 1939-2005 1939-2005 1895-2005 1902-2005 1870-2005 1929-1938 1950-2006 1870-2005 1865-2006 1820-2006 1926-1938 1950-2006 1928-2006 1950-2005 1820-2005 1950-2005 1905-2005 1850-2006 1820-2005 Source MAD/TED RR MAD/TED RR MAD/TED RR MAD/TED MAD/TED RR MAD/TED RR MAD/TED MAD/TED RR MAD/TED RR MAD/TED RR MAD/TED RR MAD/TED MAD/TED MAD/TED RR MAD/TED RR MAD/TED RR MAD/TED MAD/TED MAD/TED RR MAD/TED RR MAD/TED RR Commentary Interpolation 1821-1883 Interpolation 1821-1869 Interpolation 1821-1869 Interpolation 1821-1910 Interpolation 1821-1910 Interpolation 1821-1899 Interpolation 1821-1949 Interpolation 1821-1949 Interpolation 1939-1944 Interpolation 1871-1901 Interpolation 1871-1928 Interpolation 1821-1864 Portugal Romania Russia Singapore South Africa Spain Interpolation 1821-1949 Interpolation 1905-1949 Interpolation 1821-1849 101 .
6 Gross National Product: PPP in constant dollars (also available on a per capita basis) Country Sweden Thailand (Siam) Tunisia Turkey United Kingdom United States Uruguay Venezuela Zambia Zimbabwe Period covered 1820-2006 1950-2005 1820-2005 1950-2005 1820-2005 1923-2005 1830-2006 1820-2006 1870-2006 1820-2006 1870-2005 1900-2005 1820-2005 1950-2005 1950-2005 1919-2005 Source MAD/TED MAD/TED RR MAD/TED RR MAD/TED MAD/TED RR MAD/TED RR MAD/TED MAD/TED RR MAD/TED MAD/TED MAD/TED Commentary Interpolation 1821-1949 Interpolation 1821-1949 Interpolation 1821-1829 Interpolation 1821-1869 Interpolation 1821-1899 102 .Table AI.
missing data World War I missing data Belgium Bolivia Brazil Canada KRV MIT KRV IBGE/MIT KRV MIT Revenues begin 1885 Lower Canada Upper Canada Canada Central African Republic Chile KRV MIT KRV Braun et. MIT KRV Cheng KRV MIT KRV MIT KRV MIT KRV MIT KRV (base=1995) China Colombia Costa Rica Cote D’Ivoire Nationalist goverrment Denmark 103 .7 Central Government Expenditure and Revenue (Domestic currency units unless otherwise noted) Country Algeria Period covered 1834-1960 1964-1975 1994-1996 1963-2003 1915-1973 1980-2003 1864-1999 1880-1913 1963-2003 1839-1900 Sources MIT Commentary Revenues begin in 1830 Angola Argentina Australia KRV MIT KRV MIT Flandreau & Zumer KRV MIT Austria 1901-1997 1965-2003 1791-1993 1965-2003 1830-1993 1965-2003 1888-1999 1963-2003 1823-1994 1980-2003 1806-1840 1824-1840 1867-1995 1963-2003 1906-1912 1925-1973 1963-2003 1810-1995 1857-1998 1963-2003 1927-1936 1963-2003 1905-1999 1963-2003 1884-1999 1963-2003 1895-1912 1926-1999 1963-2003 1853-1993 1965-2003 MIT KRV MIT KRV Revenues begin in 1824.Table AI. al. New South Wales and other provinces circa 1840 Commonwealth World War I and II.
high government Italy Japan Kenya Korea Japanese yen South Korea Malaya Malaysia Mauritius 104 .Table AI. florins.7 Central Government Expenditure and Revenue (Domestic currency units unless otherwise noted) Country Dominican Republic Ecuador Egypt Period covered 1905-1999 1963-2003 1884-1999 1979-2003 1821-1879 1852-1999 1963-2003 1883-1999 1963-2003 1882-1993 1965-2003 1600-1785 1815-1993 1965-2003 1688-1806 1872-1934 1946-1993 1979-2003 1885-1940 1954-1993 1963-2003 1882-1999 1963-2003 1879-1999 1963-2003 1868-1940 1810-2000 1963-2003 1821-1940 1816-1939 1959-1999 1963-2003 1862-1993 1965-2003 1868-1993 1963-2003 1895-2000 1970-2003 1905-1939 1949-1997 1963-2003 1883-1938 1946-1999 1963-2003 1812-2000 1963-2003 Sources MIT KRV MIT KRV Landes MIT KRV MIT KRV MIT KRV ESFDB MIT KRV ESFDB MIT KRV MIT KRV MIT KRV MIT KRV MIT MIT KRV Mellegers MIT KRV MIT KRV MIT KRV MIT KRV MIT KRV MIT KRV MIT KRV Commentary El Salvador Finland France Germany (Prussia) Germany Revenues end in 1942 West Germany Expenditure begins in 1833 and again in 1946 Greece Guatemala Honduras Hungary India Indonesia Netherlands East Indies.
Table AI.7 Central Government Expenditure and Revenue (Domestic currency units unless otherwise noted) Country Mexico Morocco Period covered 1825-1998 1963-2003 1938-2000 1963-2003 1946-1999 1963-2003 1845-1993 1965-2003 1841-2000 1965-2003 1900-1999 1963-2003 1874-1998 1963-2003 1850-1992 1965-2003 1909-1996 1963-2003 1881-1900 1913-1993 1963-2003 1846-1998 1963-2003 1901-2000 1963-2003 1922-1937 1947-1993 1879-1902 1917-1992 1975-2003 1883-1992 1769-1815 1804-1914 1924-1934 1950-1990 1914-1921 1931-1951 1963-2000 Sources MIT KRV MIT KRV MIT KRV MIT KRV MIT KRV MIT KRV MIT KRV MIT KRV MIT KRV MIT KRV MIT KRV MIT KRV MIT Expenditure only MIT KRV MIT ESFDB MIT Commentary Revenues also 19201929 Myanmar (Burma) Netherlands New Zealand Nicaragua Nigeria Norway Panama Paraguay Revenues through 1902 Peru Philippines World War II missing data Poland Portugal Romania Russia Expenditure begins in 1862 Singapore Katzenellenbaum Condoide MIT National budget 105 .
7 Central Government Expenditure and Revenue (Domestic currency units unless otherwise noted) Country South Africa Period covered 1826-1904 1905-2000 1963-2003 1520-1553 1753-1788 1850-1997 1965-2003 1811-2000 1963-2003 1881-1993 1980-2003 1898-1938 1950-2000 1891-2000 1963-2003 1909-1954 1965-1999 1963-2003 1923-2000 1963-2003 1486-1815 1791-1993 1963-2003 1789-1994 1960-2003 1871-1999 1963-2003 1830-1998 1963-2003 1963-2003 1963-2003 1894-1997 1963-2003 Sources MIT KRV ESFDB MIT KRV MIT KRV MIT KRV MIT MIT KRV MIT KRV MIT KRV ESFDB MIT KRV MIT KRV MIT KRV MIT KRV KRV KRV MIT KRV Revenue begins in 1851 Commentary Natal begins in 1850 Spain Not continuous Sri Lanka Sweden Taiwan Thailand (Siam) Tunisia Turkey United Kingdom United States Uruguay Venezuela Zambia Zimbabwe 106 .Table AI.
Table AI. as noted) Country Algeria Angola Argentina Period covered 1831-2007 1891-2007 1864-2007 1885-2007 1880-1913 1826-2007 1831-2007 1846-2007 1816-2007 1899-1935 1899-2007 1821-2007 1880-1913 1832-2007 1867-2007 1857-1967 1865-1937 1950-2007 1835-1938 1919-2007 1854-1938 1921-2007 1892-2007 1900-2007 1841-2007 1865-2007 1889-1949 1924-2007 1850-2007 1869-2007 1859-1988 1870-2007 1818-2007 1900-2007 1800-2007 1880-2007 1850-2007 1900-2007 1849-2007 1900-2007 1851-2007 Sources GFD/WEO GFD/WEO GFD/WEO GFD/WEO Flandreau & Zumer GFD/WEO GFD/WEO GFD/WEO GFD GFD/WEO Flandreau & Zumer GFD/WEO GFD/WEO GFD/WEO Currency/ Commentary Lcu US$ Exports Australia Austria Belgium Bolivia Brazil Canada Chile China Colombia Costa Rica Cote D’Ivoire Denmark US$ Lcu US$ Exports Lcu US$ Lcu Lcu Lcu US$ Lcu US$ Lcu US$ Exports begin in 1818.8 Total Exports and Imports (local currency units and US$. lcu US$ Lcu US$ GFD/WEO GFD/WEO GFD/WEO GFD/WEO Ecuador Egypt El Salvador GFD/WEO GFD/WEO GFD/WEO Finland France Germany Ghana Greece Guatemala GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO Lcu US$ Lcu US$ 107 . lcu US$ Lcu US$ Lcu US$ Exports begin in 1854.
Table AI. as noted) Country Honduras India Indonesia Italy Japan Kenya Korea Malaysia Mauritius Mexico Period covered 1896-2007 1832-2007 1823-1974 1876-2007 1861-2007 1862-2007 1900-2007 1886-1936 1905-2007 1905-2007 1833-2007 1900-2007 1797-1830 1872-2007 1797-1830 1872-2007 1947-2007 1937-2007 1846-2007 1895-2007 1851-2007 1905-2007 1879-1949 1923-2007 1866-1952 1882-2007 1884-2007 1924-2007 1861-2007 1862-1993 1921-2007 1802-1991 1815-2007 1948-2007 1826-2007 1900-2007 Sources GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO Currency Lcu US$ Lcu US$ Includes Singapore until 1955 Lcu US$ UK pound Lcu US$ Morocco Myanmar (Burma) Netherlands Nicaragua Norway Panama Paraguay Peru Philippines Poland Portugal Romania Russia Singapore South Africa GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO Lcu US$ Lcu US$ Lcu US$ Lcu US$ Lcu US$ 108 .8 Total Exports and Imports (local currency units and US$.
and Savastano. and Schwartz Boughton-IMF Economist WEO Macdonald. nominal and real 1790-1850 1854-1990 1862-1999 1980-2007 1341-2007 Sovereign external default dates 109 .8 Total Exports and Imports (local currency units and US$. and United Kingdom National Statistics GFD and Bank of England GFD and Bank of England Historical Statistics of the United States. Mitchell.9 Global Indicators and Financial Centers Country United Kingdom Series Current account balance/GDP Consol rate Discount rate United States Current account balance/GDP 60-90 day commercial paper Discount rate Period covered 1816-2006 Sources Imlah. WEO Historical Statistics of the United States GFD and Board of Governors of the Federal Reserve Board of Governors of the Federal Reserve Historical Statistics of the United States. Rostow.Table AI. and Standard and Poor’s 1790-2007 1790-2007 1790-2006 1830-1900 1915-2007 Federal funds rate Long-term bond 1950-2007 1798-2007 World Commodity prices. Board of Governors of the Federal Reserve Gayer. Rogoff. Reinhart. Purcell and Kaufman. Suter. as noted) Country Spain Sri Lanka Sweden Taiwan Thailand (Siam) Turkey United Kingdom United States Uruguay Venezuela Zambia Zimbabwe Period covered 1822-2007 1825-2007 1900-2007 1832-2007 1891-2007 1859-2007 1878-2007 1796-2007 1788-2007 1862-1930 1899-2007 1830-2007 1900-2007 1908-2007 1900-2007 Sources GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO GFD/WEO Currency Lcu US$ Table AI.
Appendix II. Panizza.3 External Public Debt Table AII. The World Bank IFS: International Financial Statistics. Levy-Yeyati. IMF. LM: Lindert & Morton LofN: League of Nations MAR: Marichal MIT: Mitchell RR: Reinhart and Rogoff UN: United Nations WEO: World Economic Outlook. Public Debt This data appendix covers the government debt series used.1 Public Debentures: External Government Bond Issues Table AII. Sturzenegger ESFDB: European State Finance Data Base GFD: Global Financial Data. IMF Lcu: local currency units List of Tables Table AII. while Appendix I is devoted to the database on macro time series.2 Total (Domestic plus External) Public Debt Table AII. Abbreviations of frequently-used sources (additional sources listed in tables below) CLYPS: Cowan.4 Domestic Public Debt 110 .
LM. Winkler MAR UN MAR Landes. LM UN MAR UN Bazant. 1 Public Debentures: External Government Bond Issues Country Argentina Australia Bolivia Brazil Period covered 1824-1968 1927-1946 1857-1978 1927-1946 1864-1930 1927-1946 1843-1970 1928-1946 1860-1919 1928-1946 1822-1830 1928-1946 1865-1938 1822-1929 1928-1946 1871-1930 1862-1965 1928-1946 1922-1930 1928-1946 1824-1932 1928-1939 1856-1930 1928-1939 1867-1930 1928-1945 1870-1965 1928-1939 1824-1946 1928-1944 1923-1930 1928-1945 1822-1930 1928-1945 1815-1916 1928-1946 1928-1947 1854-1965 1933-1939 1871-1939 1928-1947 1822-1930 1928-1947 Sources LM. LM. Summerhill UN LM UN LM.Table AII. Miller UN UN Clay. LM UN MAR UN Levandis UN MAR UN MAR UN LM UN Bazant. MAR UN Attard. LM. MAR UN UN MAR UN Crisp. LM UN MAR UN MAR UN Commentary Includes first loan Includes first loan Canada Chile China Colombia Costa Rica Egypt El Salvador Greece Includes first loan Includes first loan Includes first loan (Independence loan) Guatemala Honduras India Japan Mexico Panama Peru Russia South Africa Thailand (Siam) Turkey Uruguay Venezuela Includes first loan Includes first loan Includes first loan Includes first loan Includes first loan 111 . MAR. MAR UN Huang.
Table AII. Centre d'études économiques de la KUL LofN/UN CLYPS Flandreau & Zumer LofN/UN GFD. LofN/UN Ministerio de Hacienda Cheng. al.2 Total (Domestic plus External) Public Debt (currency units are noted) Country Argentina Period covered 1863-1971 1914-1981 1980-2005 1852-1914 1914-1981 1980-2007 Source Garcia Vizcaino LofN/UN GFD. Bank of Canada Diaz et. Huang. Jeanne & Guscina Contraloria General de la Republica Soley-Guell LofN/UN CLYPS. Jeanne & Guscina Statistics Canada. Jeanne & Guscina Page LofN/UN Australian Office of Financial Management Flandreau & Zumer UN Austrian Federal Financing Agency BNB. Ministerio de Hacienda UN Flandreau & Zumer LofN/UN Danmark’s National Bank LofN/UN LofN/UN Ministry of Finance Commentary Lcu Lcu Australia Lcu Lcu Austria 1880-1913 1945-1984 1970-2006 1830-2005 Lcu Lcu euros euros Belgium Bolivia Brazil 1914-1953 1968-1981 1991-2004 1880-1913 1923-1972 1991-2005 1867-2007 1827-2000 1914-1953 1990-2007 1894-1950 1981-2005 1923-2006 1892-1914 1914-1983 1980-2007 1970-1980 1880-1913 1914-1975 1990-2007 1914-1952 1914-1972 1990-2006 Lcu US$ Lcu Lcu Canada Chile Lcu Lcu Lcu US$ China Colombia Costa Rica Lcu Lcu Lcu US$ Lcu Lcu Lcu Lcu Lcu Lcu US$ Cote D’Ivoire Denmark Dominican Republic Ecuador 112 . RR GFD.
Table AII. Lcu Lcu Lcu Lcu US$ Lcu US$ Lcu Finland France Germany Greece Guatemala Honduras Hungary India Lcu Lcu Lcu Lcu Lcu Lcu UK pounds Lcu Lcu Yen Indonesia Italy Japan Kenya Korea Malaysia Lcu Mauritius Lcu Lcu 113 .2 Total (Domestic plus External) Public Debt-continued (currency units are noted) Country Egypt El Salvador Period covered 1914-1959 2001-2005 1914-1963 1976-1983 1990-2004 2003-2007 1914-1983 1978-2007 1880-1913 1913-1972 1999-2007 1880-1913 1914-1983 1950-2007 1869-1893 1880-1913 1920-1983 1993-2006 1921-1982 1980-2005 1914-1971 1980-2005 1913-1942 1992-2005 1840-1920 1913-1983 1980-2005 1972-1983 1998-2005 1880-1913 1914-1894 1982-2007 1872-2007 1911-1935 1961-1980 1997-2007 1910-1938 1970-1984 1990-2004 1947-1957 1976-1981 1980-2004 1970-1984 1998-2007 Source LofN/UN Ministry of Finance LofN/UN CLYPS Banco Central de Reserva LofN/UN State Treasury Finland Flandreau & Zumer LofN/UN Ministère du Budget. des comptes public Flandreau & Zumer LofN/UN Bundesbank Levandis Flandreau & Zumer LofN/UN OECD LofN/UN CLYPS LofN/UN CLYPS LofN/UN Jeanne & Guscina Statistical Abstract Relating to British India LofN/UN Jeanne & Guscina UN Bank Indonesia/GDF Flandreau & Zumer LofN/UN Dipartamento del Tesoro Historical Statistics of Japan/Bank of Japan Frankel LofN/UN Central Bank of Kenya Mizoguchi & Umemura LofN/UN Jeanne & Guscina UN Jeanne & Guscina LofN/UN Commentary Lcu Lcu Lcu US$ US$ Lcu Lcu Lcu Lcu Lcu Lcu Lcu Lcu Not continuous.
Jeanne & Guscina LofN/UN GFD.2. Flandreau & Zumer LofN/UN Jeanne & Guscina UN Monetary Authority Page LofN/UN South Africa Reserve Bank Commentary Not continuous Lcu Morocco Netherlands Lcu Lcu Lcu Lcu Lcu Lcu US$ Lcu Lcu Lcu US$ US$ Lcu US$ Lcu US$ Lcu New Zealand Nicaragua Norway Panama Paraguay Peru Philippines Poland Portugal Russia Lcu In euros from 1999 French francs and Lcu Lcu Singapore South Africa Lcu Lcu UK pounds Lcu Lcu 114 . Total (Domestic plus External) Public Debt-continued (currency units are noted) Country Mexico Period covered 1814-1946 1914-1979 1980-2006 1965-1980 1880-1914 1914-1977 1914-2008 1858-2006 1914-1945 1970-1983 1991-2005 1880-1914 1913-1983 1965-2007 1915-1983 1980-2005 1927-1947 1976-1982 1990-2004 1918-1970 1990-2005 1948-1982 1980-2005 1920-1947 1994-2004 1851-1997 1914-1975 1980-2007 1880-1914 1922-1938 1993-2005 1969-1982 1986-2006 1859-1914 1910-1982 1946-2006 Source Bazant LofN/UN Direccion General de la Deuda Publica UN Flandreau & Zumer LofN/UN Dutch State Treasury Agency Statistics New Zealand/NZ Treasury LofN/UN CLYPS Flandreau & Zumer LofN/UN Ministry of Finance LofN/UN CLYPS LofN/UN CLYPS LofN/UN CLYPS LofN/UN GFD.Table AII. Jeanne & Guscina INE-Portugese Statistical Agency LofN/UN Banco de Portugal Crisp.
Bank of Thailand LofN/UN Central Bank of Tunisia LofN/UN Turkish Treasury Quinn Bazant.2 Total (Domestic plus External) Public Debt-concluded (currency units are noted) Country Spain Period covered 1504-1679 1850-2001 Source ESFDB Estadisticas Historicas de España: Siglos XIXXX Banco de España Page UN Central Bank of Sri Lanka Flandreau & Zumer LofN/UN Riksgälden LofN/UN Jeanne & Guscina.Appendix Table AII. not contiuous United States Uruguay 1791-2007 1914-1947 1972-1984 1999-2007 1914-1982 1983-2005 1924-1936 1969-1982 Lcu US$ Venezuela Zimbabwe UK pounds 115 . Page UK Debt Management Office Treasury Direct LofN/UN Banco Central del Uruguay LofN/UN Jeanne & Guscina Frankel UN Commentary Not continuous Lcu Sri Lanka 1999-2006 1861-1914 1950-1983 1990-2006 1880-1913 1914-1984 1950-2006 1913-1984 1980-2006 1972-1982 2004-2007 1933-1984 1986-2007 1693-1786 1781-1915 1850-2007 Euro UK pounds Lcu Lcu Sweden Thailand (Siam) Lcu Lcu Lcu Tunisia Turkey United Kingdom Lcu Lcu Lcu US$ Total funded debt 1787-1815.
al.Table AII. GFD RR RR GFD Contraloria General de la Republica Soley-Guell LofN/UN CLYPS.3 External Public Debt (currency units are noted) Country Algeria Angola Argentina Period covered 1970-2005 1989-2005 1863-1971 1914-1981 1970-2005 1852-1914 1914-1981 1980-2007 1945-1984 1970-2006 1914-1981 1992-2007 1914-1953 1968-1981 1970-2005 1991-2004 1824-2000 1923-1972 1970-2005 1991-2005 1867-2007 1970-2005 1822-2000 1970-2005 1822-1930 1865-1925 1981-2005 1923-2006 1892-1914 1914-1983 1980-2007 1970-2005 1914-1952 1961-2004 1914-1972 1970-2005 1990-2007 1862-1930 1914-1959 1970-2005 Source GFD GFD Garcia Vizcaino LofN/UN GFD Page LofN/UN Australian Office of Financial Management UN Austrian Federal Financing Agency LofN/UN LofN/UN GFD CLYPS IBGE LofN/UN GFD Jeanne & Guscina Statistics Canada. Bank of Canada GFD Diaz et. Ministerio de Hacienda GFD LofN/UN Banco de la Republica LofN/UN GFD Ministry of Finance RR LofN/UN GFD Commentary US$ US$ Lcu Lcu US$ Lcu Lcu Lcu euros Lcu Lcu Australia Austria Belgium Bolivia Brazil Canada Central African Republic Chile US$ £s and US$ Lcu US$ US$ Lcu US$ Lcu US$ Estimated from debentures Estimated from debentures US$ Lcu Lcu Lcu US$ US$ Lcu US$ Lcu US$ US$ Estimated from debebtures Lcu US$ China Colombia Costa Rica Cote D’Ivoire Dominican Republic Ecuador ` Egypt 116 .
3 External Public Debt-continued (currency units are noted) Country France Period covered 1913-1972 1999-2007 1914-1983 1920-1983 1921-1982 1970-2005 1980-2005 1914-1971 1970-2005 1980-2005 1913-1942 1982-2005 1992-2005 1840-1920 1913-1983 1980-2005 1972-1983 1970-2005 1880-1913 1914-1984 1982-2007 1872-2007 1910-1938 1961-1980 1970-2005 1997-2007 1970-1984 1970-2005 1990-2004 1947-1957 1976-1981 1970-2005 1980-2004 1970-1984 1970-2005 1998-2007 Source LofN/UN Ministère du Budget.Table AII. des comptes public LofN/UN LofN/UN LofN/UN GFD CLYPS LofN/UN GDF LofN/UN GDF Jeanne & Guscina Statistical Abstract relating to British India LofN/UN Jeanne & Guscina UN GDF Flandreau & Zumer LofN/UN Dipartamento del Tesoro Historical Statistics of Japan/Bank of Japan Mizoguchi & Umemura LofN/UN GDF Central Bank of Kenya LofN/UN GDF Jeanne & Guscina LofN/UN GDF Jeanne & Guscina LofN/UN GDF Bank of Mauritius Commentary Lcu Lcu Lcu Lcu Lcu US$ US$ Lcu US$ US$ Lcu US$ Germany Greece Guatemala Honduras Hungary India Lcu Lcu US$ Lcu Lcu Lcu Lcu Yen Lcu US$ Lcu Lcu US$ US$ Lcu US$ Lcu US$ Lcu Indonesia Italy Japan Kenya Korea Malaysia Mauritius 117 .
External Public Debt-continued (currency units are noted) Country Mexico Period covered 1814-1946 1820-1930 1914-1979 1970-2005 1980-2006 Morocco Netherlands 1965-1980 1970-2005 1880-1914 1914-1977 1914-2008 1858-2006 1914-1945 1970-1983 1970-2005 1991-2005 1880-1914 1913-1983 1965-2007 1915-1983 1980-2005 1927-1947 1976-1982 1970-2005 1990-2004 1822-1930 1918-1970 1990-2005 1970-2005 1948-1982 1970-2005 1920-1947 1986-2005 1851-1997 1914-1975 1980-2007 1815-1917 1922-1938 1993-2005 1969-1982 Source Bazant RR LofN/UN GDF Direccion General de la Deuda Publica UN GDF Flandreau & Zumer LofN/UN Dutch State Treasury Agency Statistics New Zealand/NZ Treasury LofN/UN GDF CLYPS Flandreau & Zumer LofN/UN Ministry of Finance LofN/UN CLYPS LofN/UN GFD CLYPS RR LofN/UN CLYPS GFD LofN/UN GFD LofN/UN GFD INE-Portugese Statistical Agency LofN/UN Banco de Portugal RR LofN/UN Jeanne & Guscina UN Commentary Not continuous Estimated from debentures Lcu US$ Lcu US$ Lcu Lcu Lcu Lcu Lcu US$ US$ Lcu Lcu Lcu US$ US$ Lcu US$ US$ Estimated from debentures Lcu US$ US$ Lcu US$ Lcu US$ New Zealand Nicaragua Norway Panama Paraguay Peru Philippines Poland Portugal Lcu In euros from 1999 Lcu Lcu Russia Singapore 118 .Table AII.
3 External Public Debt-concluded (currency units are noted) Country South Africa Period covered 1859-1914 1910-1983 1946-2006 1850-2001 Source Page LofN/UN South Africa Reserve Bank Estadisticas Historicas de España: Siglos XIXXX Banco de España UN GFD Central Bank of Sri Lanka LofN/UN Riksgälden LofN/UN GFD Jeanne & Guscina.Table AII. Bank of Thailand GFD Central Bank of Tunisia LofN/UN RR LofN/UN GFD Turkish Treasury LofN/UN RR LofN/UN GFD CLYPS RR LofN/UN GFD UN GFD Commentary UK pounds Lcu Lcu Lcu Spain Sri Lanka 1999-2006 1950-1983 1970-2005 1990-2006 1914-1984 1950-2006 1913-1984 1970-2005 1980-2006 1970-2005 2004-2007 1972-1982 1854-1933 1933-1984 1970-2005 1986-2007 1914-2007 1871-1930 1914-1947 1972-1984 1970-2005 1980-2004 1822-1842 1914-1982 1970-2005 1969-1982 1970-2005 Euro Lcu US$ Lcu Lcu Lcu Lcu US$ Lcu US$ Lcu Lcu Estimated from debentures Lcu US$ US$ Lcu Estimated from debentures Lcu US$ US$ Estimated from debentures. US $ Lcu Lcu US$ Sweden Thailand (Siam) Tunisia Turkey United Kingdom Uruguay Venezuela Zambia Zimbabwe 119 .
Huang. al. Bank of Canada Diaz et.4 Domestic Public Debt (Local currency units unless otherwise noted) Country Argentina Period covered 1863-1971 1914-1981 1980-2005 1914-1981 1980-2007 1945-1984 1970-2006 1914-1983 1992-2007 1914-1953 1968-1981 1991-2004 1923-1972 1991-2005 1867-2007 1827-2000 1914-1953 1914-1946 1990-2007 1894-1949 Source Garcia Vizcaino LofN/UN GFD. UN) Contraloria General de la Republica Soley-Guell LofN/UN CLYPS. Ministerio de Hacienda UN LofN/UN Danmark’s National Bank LofN/UN LofN/UN Ministry of Finance LofN/UN Ministry of Finance Commentary Lcu Lcu Lcu Lcu Lcu euros Lcu Australia Austria Belgium Bolivia Lcu US$ Lcu Lcu Lcu Lcu US$ Lcu Brazil Canada Chile China Colombia Costa Rica 1923-2006 1892-1914 1914-1983 1980-2007 1970-1980 1914-1975 1990-2007 1914-1952 1914-1972 1990-2006 1914-1959 2001-2005 Lcu Lcu Lcu US$ Lcu Lcu Lcu Lcu Lcu US$ Lcu Lcu Cote D’Ivoire Denmark Dominican Republic Ecuador Egypt 120 . Jeanne & Guscina LofN/UN Australian Office of Financial Management UN Austrian Federal Financing Agency LofN/UN BNB. Jeanne & Guscina Statistics Canada. Centre d'études économiques de la KUL LofN/UN CLYPS LofN/UN GFD.Table AII. LofN/UN UN Ministerio de Hacienda RR (from Cheng.
Table AII. des comptes public LofN/UN UN LofN/UN CLYPS LofN/UN LofN/UN Jeanne & Guscina Statistical Abstract relating to British India LofN/UN Jeanne & Guscina UN Bank Indonesia/GDF Flandreau & Zumer LofN/UN Dipartamento del Tesoro Historical Statistics of Japan/Bank of Japan UN LofN/UN Central Bank of Kenya LofN/UN Jeanne & Guscina LofN/UN Jeanne & Guscina LofN/UN Bank of Mauritius Bazant LofN/UN Direccion General de la Deuda Publica UN Flandreau & Zumer LofN/UN Dutch State Treasury Agency Commentary Lcu Lcu Lcu Lcu US$ Lcu US$ Lcu Greece Guatemala Honduras Hungary India Lcu Lcu Lcu Lcu Lcu Lcu Indonesia Italy Japan Kenya Korea Malaysia Lcu Lcu Lcu Lcu Lcu Mauritius Mexico Lcu Lcu Not continuous Lcu Morocco Netherlands Lcu Lcu Lcu Lcu 121 .4 Domestic Public Debt-continued (Local currency units unless otherwise noted) Country France Period covered 1913-1972 1999-2007 1920-1983 1912-1941 1921-1982 1980-2005 1914-1971 1980-2005 1913-1942 1992-2005 1840-1920 1913-1983 1980-2005 1972-1983 1998-2005 1880-1913 1914-1894 1882-2007 1872-2007 1914-1946 1961-1980 1997-2007 1970-1984 1990-2004 1947-1957 1976-1981 1980-2004 1970-1984 1998-2007 1814-1946 1914-1979 1980-2006 1965-1980 1880-1914 1914-1977 1914-2008 Source LofN/UN Ministère du Budget.
Jeanne & Guscina LofN/UN Jeanne & Guscina INE-Portugese Statistical Agency LofN/UN Banco de Portugal LofN/UN Jeanne & Guscina UN Monetary Authority Page LofN/UN South Africa Reserve Bank Estadisticas Historicas de España: Siglos XIXXX Banco de España UN Central Bank of Sri Lanka Commentary Lcu Lcu US$ Lcu Lcu Lcu US$ US$ Lcu US$ Lcu US$ Lcu Lcu Lcu Lcu Lcu In euros from 1999 Lcu Lcu Lcu UK pounds Lcu Lcu Lcu Norway Panama Paraguay Peru Philippines Poland Portugal Russia Singapore South Africa Spain Sri Lanka 1999-2006 1950-1983 1990-2006 Euro Lcu Lcu 122 .4 Domestic Public Debt-continued (Local currency units unless otherwise noted) Country New Zealand Nicaragua Period covered 1858-2006 1914-1945 1970-1983 1991-2005 1880-1914 1913-1983 1965-2007 1915-1983 1980-2005 1927-1947 1976-1982 1990-2004 1918-1970 1990-2005 1948-1982 1980-2005 1920-1947 1994-2004 1851-1997 1914-1975 1980-2007 1922-1938 1993-2005 1969-1982 1986-2006 1859-1914 1910-1983 1946-2006 1850-2001 Source Statistics New Zealand/NZ Treasury LofN/UN CLYPS Flandreau & Zumer LofN/UN Ministry of Finance LofN/UN CLYPS LofN/UN CLYPS LofN/UN CLYPS LofN/UN GFD.Table AII.
4 Domestic Public Debt-concluded (Local currency units unless otherwise noted) Country Sweden Thailand (Siam) Period covered 1914-1984 1950-2006 1913-1984 1980-2006 Source LofN/UN Riksgälden LofN/UN Jeanne & Guscina. Bank of Thailand UN Central Bank of Tunisia LofN/UN Turkish Treasury LofN/UN Treasury Direct LofN/UN CLYPS LofN/UN Jeanne & Guscina UN Commentary Lcu Lcu Lcu Lcu Tunisia Turkey United Kingdom United States Uruguay Venezuela Zimbabwe 1972-1982 2004-2007 1933-1984 1986-2007 1914-2007 1791-2007 1914-1947 1972-1984 1980-2004 1914-1982 1983-2005 1969-1982 Lcu Lcu Lcu US$ Lcu Lcu Lcu US$ Lcu Lcu Lcu 123 .Table AII.
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