"Global
Cycles: Capital Flows, Commodities, and Sovereign Defaults, 1815-2015" 
CESifo Working Paper Series No. 5737
CESifo Working Paper Series No. 5737
CARMEN M. REINHART, Harvard University -
Center for Business and Government
Email: carmen_reinhart@harvard.edu
VINCENT R. REINHART, American Enterprise Institute (AEI)
Email: vincent.reinhart@aei.org
CHRISTOPH TREBESCH, Ludwig Maximilian University of Munich, CESifo (Center for Economic Studies and Ifo Institute)
Email: christoph.trebesch@lmu.de
Email: carmen_reinhart@harvard.edu
VINCENT R. REINHART, American Enterprise Institute (AEI)
Email: vincent.reinhart@aei.org
CHRISTOPH TREBESCH, Ludwig Maximilian University of Munich, CESifo (Center for Economic Studies and Ifo Institute)
Email: christoph.trebesch@lmu.de
Capital
flow and commodity cycles have long been connected with economic crises. Sparse
historical data, however, has made it difficult to connect their timing. We
date turning points in global capital flows and commodity prices across two
centuries and provide estimates from alternative data sources. We then document
a strong overlap between the ebb and flow of financial capital, the commodity
price super-cycle, and sovereign defaults since 1815. The results have
implications for today, as many emerging markets are facing a double bust in
capital inflows and commodity prices, making them vulnerable to crises.
