What I’ve Got: Tulip mania

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In 1636, Harvard was founded, and a single Dutch tulip bulb could be sold for 12 acres of land. The bizarre bubble in tulip prices between 1636 and 1637 has not been fully explained, but it provides a great example of the interplay between social influence and economic factors. It’s often used as a morality lesson in the dangers of speculation, but the evidence we have does not conclusively prove that the rise in tulip bulb prices was a financial bubble in the same vein as the dot-com bubble or the subprime mortgage crisis. Understanding the causes of tulip mania can help us figure out how a simple product can become wildly desirable in a short time and help us avoid subsequent plunges as the product loses its edge.

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