Calendrier du 12 juin 2019
Economic History Seminar
Du 12/06/2019 de 12:30 à 14:00
Salle R1-09, Campus Jourdan, 48 boulevard Jourdan, 75014 Paris
HILT Eric (Wellesley College)
Financial Asset Ownership and Political Partisanship: Liberty Bonds and Republican Electoral Success in the 1920s
We analyze the effects of ownership of liberty bonds, which were marketed to American households during World War I, on election outcomes in the 1920s. We find that counties with higher liberty bond ownership rates turned against the Democratic Party in the presidential elections of 1920 and 1924. This was a reaction to the depreciation of the bonds prior to the 1920 election (when the Democrats held the presidency), and the appreciation of the bonds in the early 1920s (under a Republican president), as the Fed raised and then subsequently lowered interest rates. Our results suggest the liberty bond campaigns had unintended political consequences and illustrate the potential for financial asset ownership to increase the sensitivity of ordinary households to economic policy decisions.