John Law controlled France’s Mississippi Company during the 1720 Mississippi Bubble.
John Law was a Scottish economist and financier who became influential in France under the regent Philippe II, Duke of Orléans. Law established the Banque Générale, later transformed into the Banque Royale, and promoted paper money and a large company associated with French colonial claims in North America.
The Mississippi Company absorbed other trading and tax-collecting operations, while investors bought its shares in Paris. Expectations about profits from the Mississippi territory pushed prices sharply higher in 1719 and 1720. The boom depended heavily on expanding paper credit and confidence in Law’s financial system.
Confidence eventually failed, causing a run on banknotes and a collapse in the company’s share price. The bubble was connected to France’s effort to manage its enormous national debt after the wars of Louis XIV. It is often discussed alongside Britain’s South Sea Bubble, though the two were separate schemes.