Identifying the Effects of Bank Failures from a Natural Experiment in Mississippi during the Great Depression

• 成果类型: Article
• 署名作者: Ziebarth, Nicolas L.
• 署名单位: University of Iowa
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MACROECONOMICS
• ISSN/ISSBN: 1945-7707
• DOI: 10.1257/mac.5.1.81
• 发表日期: 2013
• 页码: 81-101
• 关键词: shocks evidence; COMPETITION; PRODUCTIVITY; CRISIS

摘要

I examine the causal effect of bank failures during the Great Depression using the quasi-experimental setup of Richardson and Troost (2009). The experiment is based on Mississippi being divided into two Federal Reserve districts, which followed different policies for liquidity provision. This translated into variation in bank failures across the state. Employing a plant-level sample from the Census of Manufactures, I find that banking failures had a negative effect on revenue stemming from a fall in physical output. I find no effect on employment at the plant-level and a large decline at the county-level.