chapter  2
12 Pages

The stock market in early modern England

The stock market was unfamiliar to most people and was a relatively new phenomenon. Early modern religious and social ideas were often hostile to banking and finance. Contemporary commentary on the stock market tends to be negative, even outside of the Bubble period. Primary sources of this type form the basis of the gambling mania argument. The revisionist school of financial history on the Bubble counters the idea of a gambling or speculative mania. Revisionist works tend to be highly technical and aimed at a specialist audience. Therefore, the financial history literature has not succeeded in removing the traditional belief that the Bubble was caused by a mysterious outbreak of gambling fever. This chapter explains why the early modern stock market was not a gambling den. It uses qualitative evidence to explain the historical context. It also uses financial theory to explain how bubbles can form without being caused by a speculative mania.