Revolution, Restoration, and Debt Repudiation: The Jacobite Threat to England's Institutions and Economic Growth

Abstract

This study provides an empirical test of North and Weingast's theory of British capital-market development after the Glorious Revolution. The evidence is consistent with the hypotheses that institutional innovation in the 1690s led to the dramatic growth in London capital markets, and that threats to these institutions caused financial turmoil. We also find the economic motivation for these innovations to be consistent with the work of Ekelund and Tollison.