Discussion Paper

Crisis Chronicles: The Hamburg Crisis of 1799 and How Extreme Winter Weather Still Disrupts the Economy

Abstract: With intermittent war raging across much of Western Europe near the end of the eighteenth century, by about 1795, Hamburg had replaced Amsterdam as an important hub for commodities trade. And from 1795 to 1799, Hamburg boomed. Prices for goods increased, the harbor was full, and warehouses were bulging. But when a harsh winter iced over the harbor, excess demand and speculation drove up prices. By spring, demand proved lower than supply, and prices started falling, credit tightened, and the decline in prices accelerated. So when a ship bound for Hamburg laden with gold sunk off the coast, an act meant to avert a crisis failed to do so. In this issue of Crisis Chronicles, we use some diverse sources from the American Machinist and Mary Lindemann?s Patriots and Paupers to explore the Hamburg crisis of 1799 and describe how harsh winter weather still impacts the economy today.

Keywords: wars; Amsterdam; Hamburg; contraction; storms; housing; harvest; winter; weather;

JEL Classification: N2;E2;

Bibliographic Information

Provider: Federal Reserve Bank of New York

Part of Series: Liberty Street Economics

Publication Date: 2014-08-08

Number: 20140808