Economics at your fingertips  

'Blood and treasure': exiting the Great Depression and lessons for today

Kris James Mitchener and Joseph Mason

Oxford Review of Economic Policy, 2010, vol. 26, issue 3, 510-539

Abstract: Although avoiding the policy mistakes of the 1930s helped define how policy-makers responded to the 2007--8 financial crisis and ensuing recession, policy applications to the recovery phase are less well understood. We draw on the experience of the US in the 1930s to shed light on exit strategies--movements back to institutional conditions associated with steady-state growth, including stable inflation and broadly non-interventionist credit- and capital-market policies. We describe how policy responses to the deflation and banking crises of the 1930s coloured the exit policy debate after the Great Depression. We show that a full exit from the Great Depression, defined as the point at which interventionist credit- and capital-market policies and institutions were wound down did not occur in the 1930s. It took until the 1950s for this to occur and for the Federal Reserve to regain its independence and return unfettered to its longer-run objectives. Copyright 2010, Oxford University Press.

Date: 2010
References: Add references at CitEc
Citations: View citations in EconPapers (7) Track citations by RSS feed

Downloads: (external link) (application/pdf)
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:

Access Statistics for this article

Oxford Review of Economic Policy is currently edited by C. Allsopp

More articles in Oxford Review of Economic Policy from Oxford University Press
Bibliographic data for series maintained by Oxford University Press () and Christopher F. Baum ().

Page updated 2021-06-15
Handle: RePEc:oup:oxford:v:26:y:2010:i:3:p:510-539