a contrarian view of the Dutch tulip bubble

[eub]

A Slate article summarizes an argument (PDF, graphs all black) that the Dutch tulip bubble wasn't a bubble -- it was an efficient market response to a legislative intervention, when the Dutch legislature essentially converted outstanding tulip futures into options, at the behest of certain burgomasters who had gotten themselves into a hole.

Comments

[hattifattener]

Coincidentally, I just finished the tulipomania section of The Botany of Desire. I ought to read this article while Pollan's description is still fresh in my mind.

Googling for a better scan of that article didn't turn one up but it did find this webpage, Caslon Analytics profile: the dot-com bubble, which has some more general contextual stuff on booms and bubbles (and a link to the Thompson-Treussard paper).

[eub.livejournal.com]

This "Mississippi System" is interesting, and something I'd never heard of. The best description I came across is pages 13-16 of The History of Banks: To Which Is Added, a Demonstration of the Advantages and Necessity of Free Competition In the Business of Banking (PDF), by a Richard Hildreth.

And then in illustration there's the Frontispiece of Arlequin Actionist (Amsterdam, 1720), reprinted in Antoine Murphy, John Law (Oxford, 1997). ("You're looking at a contemporary scatological rendering of John Law making fiat money. You can see him up on the platform there being fed hard money and then passing paper money out the other end.")