How a moral panic became an economics legend 

Within weeks of the market's end, the Dutch printing presses went to work. A wave of pamphlets appeared, the best known being dialogues between two characters, Gaergoedt and Waermondt, in which a ruined trader explains the whole affair to a sceptical neighbour. They are lively, quotable and openly moralising, written to warn readers against greed, gambling and the abandonment of honest trade.

They were not journalism. They were satire with a sermon inside it, produced in a Calvinist commercial society that had a real anxiety about sudden wealth and an appetite for stories in which vanity is punished. The prints of the period carry the same message visually: traders as monkeys handling bulbs, the goddess Flora sailing in a ship of fools. Read as evidence of what people feared, they are invaluable. Read as accounts of what happened, they are wildly unreliable, and they are the ultimate source of most of the numbers and anecdotes that later writers repeated.

The retelling that fixed the story in English came two centuries later. In 1841 the journalist Charles Mackay published Extraordinary Popular Delusions and the Madness of Crowds, with a chapter on the tulip mania drawn largely from those pamphlets and from later compilations built on them. Mackay is an excellent writer and an unreliable historian. The sailor who eats a priceless bulb thinking it an onion, the whole nation abandoning its trades, the collapse that left the Republic prostrate, all of it enters the modern canon through him.

Then came the reinforcement loop. Mackay's chapter is short, entertaining and endlessly reprintable, so it became the standard reference for financial writers. Every new boom produced articles invoking it. Economists cited it as the archetype of irrational exuberance. The anecdote about the onion appeared in respectable places for a century and a half. Nobody needed to check it, because everybody had read it somewhere reputable.

Careful work began pushing back in the twentieth century. Peter Garber argued that many tulip prices were defensible given the economics of rare bulb propagation, and that the price behaviour was less inexplicable than the legend requires. Goldgar's archival research then dismantled the story of mass participation and mass ruin. Neither denies that prices rose sharply and collapsed. Both deny the moral fable wrapped around the event.

This is worth more than a footnote, because it describes how a great deal of what we consider general knowledge is transmitted: a vivid source, a talented populariser, and then repetition doing the work of verification. Tulip mania survived not because it was well documented but because it was well told.

Strip away the fable and something more useful remains, a pattern precise enough to recognise in your own century.