Tulip mania is widely regarded as the first recorded speculative market bubble. It occurred in the Dutch Republic during the 1630s, when contracts for tulip bulbs were traded at prices far beyond the flowers’ ordinary use value.
Tulips had become fashionable luxury goods after arriving in Western Europe from the Ottoman Empire. Rare varieties attracted collectors, and a futures-like trade developed in which buyers and sellers agreed to exchange bulbs later. This arrangement made it possible to speculate without immediately possessing a mature flower.
Prices rose rapidly before confidence broke in February 1637. Some auctions failed to attract buyers, and prices fell sharply. The exact scale of the economic damage is debated by historians, and popular accounts often exaggerate the effect on the entire Dutch economy.
Tulip mania differs from a modern share-market crash because the traded assets were flower bulbs and contracts, not listed company shares. It remains a classic example of speculative behavior and collapsing expectations.