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Wars and Markets: How Bond Values Reflect World War II

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  • Bruno S. Frey
  • Marcel Kucher

Abstract

Historical events are reflected in asset prices. In this paper, we analyse government bond prices of Germany and Austria traded on the Swiss bourse during WWII. Some war events that are generally considered crucial are clearly reflected in government bond prices. This holds, in particular, for the official outbreak of the war and the loss and gain of national sovereignty. Other events to which historians attach great importance are not reflected in bond prices: The most prominent example is Germany's capitulation in 1945. The analysis of financial markets provides a fruitful method to evaluate the importance contemporaries attached to historical events.

Suggested Citation

  • Bruno S. Frey & Marcel Kucher, 1999. "Wars and Markets: How Bond Values Reflect World War II," CESifo Working Paper Series 221, CESifo.
    • Handle: RePEc:ces:ceswps:_221
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    Cited by:

    1. Arola, Mika, 2006. "Foreign capital and Finland: central government's firstperiod of reliance on international financial markets 1862-1938," Bank of Finland Scientific Monographs, Bank of Finland, volume 0, number sm2006_037, July.
    2. He, Yinghua & Nielsson, Ulf & Wang, Yonglei, 2017. "Hurting without hitting: The economic cost of political tension," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 51(C), pages 106-124.
    3. Sudipta Mukherjee, 2022. "Consumer altruism and risk taking: why do altruistic consumers take more risks?," International Review on Public and Nonprofit Marketing, Springer;International Association of Public and Non-Profit Marketing, vol. 19(4), pages 781-803, December.
    4. Arola, Mika, 2006. "Foreign capital and Finland : central government's firstperiod of reliance on international financial markets 1862-1938," Scientific Monographs, Bank of Finland, number 37/2006.
    5. repec:zbw:bofism:2006_037 is not listed on IDEAS
    6. Vincent Medina & Cyr-Denis Nidier, 2003. "Pricing war within a real option framework," Defence and Peace Economics, Taylor & Francis Journals, vol. 14(6), pages 425-435.

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