Working Paper

Clearinghouse access and bank runs: comparing New York and Chicago during the Panic of 1907


Abstract: During the Panic of 1907, New York City trust companies were not members of the New York Clearinghouse whereas trust companies in Chicago were members of the Chicago Clearinghouse. We argue that the apparent isolation of New York City trust companies from the pool of bank reserves controlled by the New York Clearinghouse led to the large-scale depositor runs on the New York City trusts. In contrast, Chicago trust companies had direct access to the Chicago Clearinghouse and their pool of reserves and did not suffer large-scale depositor withdrawals. Statistical evidence on a cross-section of intermediaries in both New York and Chicago supports this contention.

Keywords: Bank failures; Banks and banking - History; Clearinghouses (Banking); Chicago (Ill.); New York (N.Y.);

Status: Published in Journal of Economic History, March 2000

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Bibliographic Information

Provider: Federal Reserve Bank of Atlanta

Part of Series: FRB Atlanta Working Paper

Publication Date: 1995

Number: 95-9