The Market for Bank Stocks and the Rise of Deposit Banking in New York City, 1866-1897

摘要

The rapid growth of deposits in New York over the late nineteenth century is often attributed to the release of pent-up demand for transactions services. I advance a complementary explanation that emphasizes the market for bank shares. The stock market was important because it generated quotations that signaled depositors about the condition of individual banks as innovations in banking practices allowed confidence to grow. A new database of prices, dividends, and balance sheet items for traded banksand a series of dynamic panel models show that fluctuations in bank prices influenced the course of the expansion.