List of completed and published PhD Theses/Dissertations by members and associated scientists of SPP 1859:
abstract and open access version is upcoming
The central purpose of this dissertation is to study investors characteristics, as well as investment decisions on the different German stock exchanges in the period 1869 to 1955. It offers three studies that reveal typical characteristics of investors and their investment behavior over time. Increasing our knowledge of investors and how they built expectations therefore crucially improves our understanding about the economic and political situation in Germany in the considered time period.
The dataset is new and unique and includes information of more than 10,000 individual investors. The investors data are taken from archival resources containing lists of shareholders who attended a firms’ general assembly, shareholder books of different companies, portfolio choices over the lifetime of a single private banker and diary entries of individual investors.
The first part of this dissertation presents a study of investors characteristics and the ownership structure of joint-stock firms for the period of 1869 to 1945. It is shown that after the hyperinflation of 1923, when shares became cheaper, the ownership share among lower social classes rose significantly. Moreover, with the rise of women rights after 1919, the number of shares owned by women also increased significantly. However, despite these shifts, the majority of shares remained in the hands of institutional investors and investors from the upper class.
The second part analyzes investors’ expectations and investment decisions in regional stock exchanges in Germany from 1898 to 1934. The statistical analysis, which is based on shareholder lists attending general meetings first indicates that local investment was clearly important during this period. Then, challenging these findings and analyzing different sub-samples, suggests that investors’ home bias is potentially overestimated using this kind of source. In a supplementary exploration of so-called shareholder books, it is shown that the home bias phenomenon was indeed present.
The bias towards local investments can to a large extent be explained by overall economic and political circumstances, the general performance of the market and the level of activity of the investor. The examination of portfolio choices over the period 1923 to 1955 of the private banker Joseph Frisch, in Stuttgart, shows that the preference for local shares was highest in times of insecurity, low returns and reduced investment activity. Furthermore, the analysis of diary entries of an investor from the late 19th century provides further insights into the investment behavior.
The final part of this dissertation gives a general conclusion and a brief outlook about future Research.
This dissertation aims at advancing our understanding of the state-finance nexus in times of globalized financial market capitalism. It sheds light on the profound changes that have occurred on both sides of this relationship since OECD countries have transitioned into debt states since the 1970s. This is done in a first part by examining the financialization of the state in the area of government debt management. Based on the development of a concept that makes it possible to measure this phenomenon, a discernible trend is shown according to which states have aligned their handling of debt with financial markets along two dimensions. First, the sense-making frameworks that guide action in debt management, nowadays, originate from financial economics, so that a portfolio view on indebtedness has found its way into the public realm. Second, the financial market has become the predominant governance mechanism in which economic coordination takes place in this area. Thus, states have increasingly adopted financial market logics and practices in public finance, one of the core areas of modern democracies. At the same time, governments have made a decisive contribution to the development of modern financial markets by the increasing orientation towards international investors and marketability of public debt. These interpenetrations of politics and finance are not limited to the national, but also extend to the subnational level. Local governments in Germany, the US and UK have introduced financial derivatives since the 1980s and continue to use them in some cases, even though they suffered major losses from these instruments during the financial crisis. By combining political economy with an economic sociological perspective, the causes that led to the local manifestation of this phenomenon are scrutinized. It is shown that the chronically underfinanced municipalities hoped to regain financial and political leeway through the use of financial innovations, which were strongly promoted and lobbied by financial institutions. The second part of the thesis analyzes the state-finance nexus from the perspective of the financial industry and the business with public debt, which is embodied in the emergence of pure public sector lending banks in the German mortgage banking sector. Unpacking the manifold state-banks relations demonstrates that the historical emergence of this crisis-ridden business model focusing on public finance closely interacts with the different roles played by the state in financial markets as economic policy maker, borrower, regulator and supervisor. The state is deeply involved in the process of coping with competition between banks by enabling change and stabilization of the social structures in which banks’ activities play out. Overall, this dissertation reiterates that the relationship between the state and finance is by no means one-sided, but rather characterized by mutual conditionality. It further highlights that the state-finance nexus is a complex configuration that also arises from the multilayered nature of the two entities themselves. Neither the financial sector nor the state are monolithic, but highly differentiated social arenas in which different actors and interests coexist. It is therefore of great importance that intra-state politics and dynamic relations within both entities are taken into account when studying relations between state and finance.