A social network for trade and inventories of stock during the South Sea Bubble

Andrew Mays, Gary S Shea

Research output: Working paper

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Abstract

A social network of stock trading is defined for the notorious South Sea Bubble. Complete market trade in East India Company and Bank of England shares is described in a flow network. Intermediation is treated as a form of network centrality, which can be analysed using measures of pass-through, inventories and immediacy. New features of the South Sea Bubble are documented: i) the crisis suffered by goldsmith bankers may have pre-dated the Bubble; ii) yet the depth and immediacy of intermediation was maintained throughout the Bubble; iii) a gradual trend towards dis-intermediation occurred after the Bubble and iv) a there was a switch from intermediation based upon brokerage to intermediation based upon dealership.
Original languageEnglish
Number of pages47
Publication statusUnpublished - Mar 2012

Publication series

NameCDMA Working Paper
No.1110

Keywords

  • Weighted multidigraph
  • Flow network
  • Financial intermediation
  • Brokerage

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