Academic literature on the topic 'Austrian Succession, War of, 1778-1779'

Using 1708-1788 historical data, we test the Austrian hypothesis that fractional-reserve banking destabilizes commodity prices, complicating eco­ nomic calculation and entrepreneurial planning, and contributes to boom-bust cycles. The Bank of Amsterdam («Wisselbank», 1609-1819) maintained high reserve requirements until the Fourth Anglo-Dutch War (1780-1784), when its reserve ratio plummeted from nearly 100% in 1778 to around 20% by 1788. We compare price volatilities for 1722-1779 and 1780-1788 using fractal Hurst exponents. For all commodity prices tested, fractal volatility was higher during the lower fractional reserve period, except for rye, wheat, and Hamburg Bills of Exchange. Bill of Exchange stability was likely attributable to Hamburg transport ships’ ability to evade British incursion and to the Wisselbank’s legal monopsony in the secondary commercial paper market. However, rye and wheat prices — directly indicative of bread prices — generally (and contrary to Austrian theory) stabilized even though British blockades significantly re­ duced Dutch bread grain imports. We attribute this unexpected result primarily to emergency wartime provision by the Amsterdam municipal granary. The Wisselbank experience may confirm, or at least does not clearly falsify, the economic relevance of the Austrian Fractional-Reserve Banking Hypothesis. Keywords: Fractional reserve banking, monetary expansion, price stability, equilibrium. JEL Codes: E42, E44, N13, N23, N83. Resumen: Analizando los datos históricos correspondientes al Banco de Áms­ terdam de 1708 a 1788 concluimos que la evidencia empírica confirma (o al menos no refuta) la hipótesis austriaca sobre los negativos efectos de la banca con reserve fraccionaria. Palabras clave: Banca con reserva fraccionaria, expansión monetaria, estabili­ dad de precios, equilibrio. Clasificación JEL: E42, E44, N13, N23, N83.

This chapter details the struggle with Prussia, from Frederick the Great’s first invasion of Silesia to the stalemate of the War of the Bavarian Succession (1778–79). Though a member of the German Reich and titular supplicant to the Habsburg Holy Roman emperor, Prussia possessed predatory ambitions and a military machine with which to realize them. Under Frederick II (the Great), Prussia launched a series of wars against the Habsburg lands that would span four decades and bring the Habsburg Monarchy to the brink of collapse. Though physically larger than Prussia, Austria was rarely able to defeat Frederick’s armies in the field. Instead, it used strategies of attrition, centered on terrain and time management, to draw out the contests and mobilize advantages in population, resources, and allies. First, in the period of greatest crisis (1740–48), Austria used tactics of delay to separate, wear down, and repel the numerically superior armies of Frederick and his allies. Second, from 1748 to 1763, Austria engineered allied coalitions and reorganized its field army to offset Prussian advantages and force Frederick onto the strategic defensive. Third, from 1764 to 1779, it built fortifications to deter Prussia and finally seal off the northern frontier. Together, these techniques enabled Austria to survive repeated invasions, contain the threat from Prussia, and reincorporate it into the Habsburg-led German system.