I would like to thank Professor Emeritus Larry D. Neal at University of Illinois at Urbana-Champaign, my colleagues Aziz Turhan and Yakup Asarkaya and anonymous referees of this journal for their valuable comments and suggestions.
WAS THERE A GUARANTEE EFFECT FOR THE OTTOMAN LOANS IN THE NINETEENTH CENTURY?
Article first published online: 23 JUL 2012
© 2012 The Author. Australian Economic History Review© 2012 Blackwell Publishing Asia Pty Ltd and the Economic History Society of Australia and New Zealand
Australian Economic History Review
Volume 52, Issue 2, pages 191–208, July 2012
How to Cite
AL, H. (2012), WAS THERE A GUARANTEE EFFECT FOR THE OTTOMAN LOANS IN THE NINETEENTH CENTURY?. Australian Economic History Review, 52: 191–208. doi: 10.1111/j.1467-8446.2012.00349.x
- Issue published online: 23 JUL 2012
- Article first published online: 23 JUL 2012
- country risk;
- government debt;
- guarantee effect;
- Ottoman Empire
This study analyses the effect of formal guarantees of the British government on the performance of Turkish bonds issued in the second half of the nineteenth century. We compare the yields and prices of 11 bonds issued by the Ottoman government with different guarantees attached to each bond. Our findings indicate that the formal guarantee of the British government was significant in determining the prices and yields of Ottoman bonds. Even though the British guarantee had no effect on Ottoman institutions, practices, and fiscal fundamentals, the yields on the guaranteed loan did not move together with other Ottoman loans.