State Building in a Multipolar World: Financial History and the Making of the Modern Chinese State in the Early Twentieth Century
2: The Shanghai Rubber Stock Market Crisis
Friday, March 25, 2022
1:30pm – 3:00pm EST
Virtual Paper Presenter(s)
Graduate Institute of International and Development Studies, Switzerland
Shanghai in the early twentieth century combined financial prosperity with an openness to foreign trade, and a unique legal fabric of the International Settlement. These factors laid the groundwork for a flourishing stock market from the late Qing dynasty onwards, as embodied by the Shanghai Stock Exchange which was established by foreign businessmen in 1905. It was on this stock exchange that the epochal rubber stock market crisis happened between 1910-1911, an event that has often been considered as the ‘final straw’ for the ailing Qing dynasty Beyond its political significance, however, the crisis can also serve as an important case for studying the contribution of Western-style capitalism in the evolution of the Chinese financial system. Chinese-language studies on the Shanghai rubber stock market crisis revolves around blaming the West for precipitating the crisis, while English and French scholarship focus on the foreign contribution to the Shanghai stock market. This paper investigates the case from a ‘center-periphery’ perspective. It adopts a novel quantitative analysis of the historical Shanghai Stock Exchange quotations and a thorough historical survey of financial journalism in Shanghai, London and Southeast Asia. Going beyond replicating the role of the West at the center of the world-economy in the making of financial capitalism in Shanghai, the paper demonstrates Shanghai’s unique strength as a capable periphery market that managed to transform its decentralised financial system into a modern financial system.