17 Feb 2023

Now at Harvard Business School: The South Sea Bubble, 1720: Narratives of the First International Crash

New Baker Library | Bloomberg Center Exhibition Highlights the First International Financial Collapse

BOSTON—Harvard Business School’s (HBS) Baker Library has opened a new exhibition that focuses on the history of one of the most infamous financial crashes. “The South Sea Bubble, 1720: Narratives of the First International Crash” was organized by Baker Library Special Collections

“Des Waerelds Doen en Doolen, is Maar een Mallemoolen (The Actions and Designs of the World Go Round as if in a Mill).” Het Groote Tafereel der Dwaasheid. Amsterdam, 1720. Kress Collection, Baker Library, Harvard Business School.

A formative moment in financial history, the bubble was the result of speculative mania that swept across Great Britain and Europe in the early 18th century. British citizens from all walks of life invested in the South Sea Company, a public private enterprise that was granted a trade monopoly with Spanish colonies in South America in return for converting British government debt into company shares. In 1720, the company profits peaked before abruptly crashing.

Baker Library holds one of the world’s most extensive collections relating to the 18th century financial crisis. Through original books, pamphlets, manuscripts, financial instruments, satirical prints, and broadsides, the exhibition explores the South Sea Company’s history, including:

  • The Founding of the South Sea Company: Chancellor of the Exchequer Robert Harley and businessman John Blunt used the debt-equity swap model of the Sword Blade Company to form the South Sea Company in 1711.
  • The South Sea Company and the Slave Trade: In 1713, under the Treaty of Utrecht, Spain gave Great Britain a license to conduct the slave trade in the Spanish colonies of South America. The contract was given to the South Sea Company.
  • · The Bubble: The ties among South Sea Company, the government, and the monarchy created an enterprise characterized by many historians as, theoretically, “too big to fail.”
  • The Crash: After hitting its peak in July the bubble finally burst, and many Britons and Europeans lost their fortunes overnight.
  • The South Sea Bubble in Satire and Farce: After the crash, the public could choose among ballads, songs, farces, poems, broadsides, pamphlets, satirical prints, and even playing cards that offered entertaining perspectives on the fraud and folly of the speculation mania.
  • Jack of Spades. In [South Sea
    Bubble Playing Cards]. London: Carington
    Bowles, 1721.
    Kress Collection, Baker Library,
    Harvard Business School. A Ruin'd South-Sea
    Jobber of Renown,
    / Leaps from a lofty Window,
    Head long down, / When taken up, he
    crys Adzounds
    I'm broke, / Who gives
    Eight Hundred Pounds for South Sea St

    More than three centuries later, the South Sea Bubble continues to survive as a cautionary tale. “The collapse marked a momentous occasion in financial history,” said Laura Linard, senior director of Baker Library Special Collections. “The exhibition sheds a light on the figures who played pivotal roles in the creation of the bubble—and those who suffered the consequences as a result.” From Parliamentary acts to satirical prints, the South Sea Bubble Collection at Baker Library reveals economic, political, cultural, and social narratives of the investor frenzy and ensuing financial collapse of 1720 that resonate to this day.

    The exhibition will be on display through August 2023 in the North Lobby of Baker Library | Bloomberg Center on the HBS campus in Boston. For more information on the exhibition and to see visiting hours, please visit the Baker Library website.

    The accompanying online research portal allows users to search in-depth an extraordinary collection that offers opportunities for multi-disciplinary research.

    About Harvard Business School

    Founded in 1908 as part of Harvard University, Harvard Business School is located on a 40-acre campus in Boston. Its faculty of more than 250 offers full-time programs leading to the MBA and PhD degrees, as well as more than 175 Executive Education programs, and Harvard Business School Online, the School’s digital learning platform. For more than a century, faculty have drawn on their research, their experience in working with organizations worldwide, and their passion for teaching, to educate leaders who make a difference in the world. The School and its curriculum attract the boldest thinkers and the most collaborative learners who will go on to shape the practice of business and entrepreneurship around the globe.