TY  - JOUR
AU  - Grada,Cormac O
AU  - White,Eugene N.
TI  - Who Panics During Panics? Evidence from a Nineteenth Century Savings Bank
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 8856
PY  - 2002
Y2  - March 2002
UR  - http://www.nber.org/papers/w8856
L1  - http://www.nber.org/papers/w8856.pdf
N1  - Author contact info:
Eugene N. White
Department of Economics
Rutgers University
75 Hamilton Street
New Brunswick, NJ 08901-1248
Tel: 732-932-7363
Fax: 732/932-7416
E-Mail: white@economics.rutgers.edu
AB  - Using records of the bank accounts of individual depositors, this paper provides a detailed microeconomic analysis of two nineteenth century banking panics. The panics of 1854 and 1857 were not characterized by an immediate mass panic of depositors and had important time dimensions. We examine depositor behavior using a hazard model. Contagion was the key factor in 1854 but it was not strong enough to create more than a local panic. In contrast, the panic of 1857 began with runs by businessmen and banking sophisticates followed by less informed depositors. Uninformed contagion may have been present, but the evidence suggests that this panic was driven by informational shocks in the face of asymmetric information about the true condition of bank portfolios.
ER  -