The Monetary Policy of the Reichsbank during the Second World War

Zdenka Johnson

Rivista di storia economica, 2018, issue 1, 107-134

Abstract: The German central bank played a key role in the financing of the war economy. It directly and indirectly monetized a significant share of war government expenditures and thus together with the banking sector provided an extra financial cushion for the economic plans of the Nazis during the Second World War. Growing government spending was mainly covered by domestic sources, such as taxes, retracting savings from the financial system and excessive money creation. Within the domestic economy the German government preferred «hidden, silent» sources of funding over public issues of state bonds. The Reichsbank repeatedly tried to tackle the issue of the (hidden) increasing rate of inflation However, it was, by and large, unsuccessful, since the pressure for financing war expenditures resulted inflationary money printing. Remarkably, Nazi leadership was not concerned with the detrimental effects of these issues. Since mid-1944 German war economy was obviously heading into inevitable hyperinflation and collapse.

Keywords: Germany; Second World War; Monetary Policy; Reichsbank; Monetization; Inflation. (search for similar items in EconPapers)
Date: 2018
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.rivisteweb.it/download/article/10.1410/91204 (application/pdf)
https://www.rivisteweb.it/doi/10.1410/91204 (text/html)
Access to full text is restricted to subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mul:jrkmxm:doi:10.1410/91204:y:2018:i:1:p:107-134

Access Statistics for this article

Rivista di storia economica is currently edited by P.L. Ciocca, G. Federico, G. Toniolo (resp.)

More articles in Rivista di storia economica from Società editrice il Mulino
Bibliographic data for series maintained by ().