Extraordinary Popular Delusions

Extraordinary Popular Delusions and the Madness of Crowds

Extraordinary Popular Delusions and the Madness of Crowds is a popular history of popular folly by Charles Mackay, first published in 1841. The book chronicles its targets in three parts: "National Delusions", "Peculiar Follies", and "Philosophical Delusions".

The subjects of Mackay's debunking include alchemy, beards (influence of politics and religion on), witch-hunts, crusades and duels. Present day writers on economics, such as Andrew Tobias, laud the three chapters on economic bubbles.


Among the alleged bubbles or financial manias described by Mackay is the Dutch tulip mania of the early seventeenth century. According to Mackay, during this bubble, speculators from all walks of life bought and sold tulip bulbs and even futures contracts on them. Allegedly, some tulip bulb varieties briefly became the most expensive objects in the world,1637.

Other bubbles described by Mackay are the South Sea Company bubble of 17111720, and the Mississippi Company bubble of 17191720.

Two modern researchers, Peter Garber and Anne Goldgar, independently conclude that MacKay greatly exaggerated the scale and effects of the Tulip bubble. Mike Dash, in a footnote to his modern popular history of the alleged bubble states:

The history of the tulip mania itself, however, remains remarkably obscure, and even now it has never been the subject of an exhaustive scholarly inquiry.

....My general feeling, after reviewing the available material, is that even after sounding the necessary notes of caution about the reliability of the popular accounts, historians and particularly economists remain guilty of exaggerating the real importance and extent of the tulip mania. (p.222, footnote)

Financier Bernard Baruch credited the lessons he learned from Extraordinary Popular Delusions and the Madness of Crowds with his decision to sell all his stock ahead of the financial crash of 1929.

Financial writer Michael Lewis includes the financial mania chapters in his book The Price of Everything as one of the six great works of economics, along with writings by Adam Smith, Thomas Malthus, David Ricardo, Thorstein Veblen, and John Maynard Keynes.


  • "Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one!" Charles Mackay
  • "Of all the offspring of Time, Error is the most ancient, and is so old and familiar an acquaintance, that Truth, when discovered, comes upon most of us like an intruder, and meets the intruder's welcome."



  • Charles MacKay, Extraordinary Popular Delusions and the Madness of Crowds, with a foreword by Andrew Tobias (1841; New York: Harmony Books, 1980). ISBN 0-517-53919-5
  • Mike Dash, Tulipomania: The Story of the World's Most Coveted Flower and the Extraordinary Passions It Aroused (1999) ISBN 0-575-06723-3
  • Peter M. Garber, Famous First Bubbles: The Fundamentals of Early Manias (Cambridge, MA: MIT Press, 2000).
  • Anne Goldgar, Tulipmania: Money, Honor, and Knowledge in the Dutch Golden Age (University of Chicago Press, 2007).

See also

External links

The book is in the public domain and is available online from a number of sources:

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