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The Gold Standard and the Great Depression: a Dynamic General Equilibrium Model

Luca Pensieroso () and Romain Restout ()
Additional contact information
Romain Restout: Université de Lorraine, Université de Strasbourg, CNRS, BETA

No 2018016, Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) from Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES)

Abstract: Was the Gold Standard a major determinant of the onset and the protracted character of the the Great Depression of the 1930s in the United States and Worldwide? In this paper, we model the ‘Gold-Standard hypothesis’ in a dynamic general equilibrium framework. We show that encompassing the international and monetary dimensions of the Great Depression is important to understand what happened in the 1930s, especially outside the United States. Contrary to what is often maintained in the literature, our results suggest that the vague of successive nominal exchange rate devaluations coupled with the monetary policy implemented in the United States did not act as a relief. On the contrary, they made the Depression worse.

Keywords: Gold Standard; Great Depression; Dynamic General Equilibrium (search for similar items in EconPapers)
JEL-codes: N10 E13 N01 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dge, nep-his, nep-mon and nep-opm
Date: 2018-12-03
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Related works:
Working Paper: The Gold Standard and the Great Depression: a Dynamic General Equilibrium Model (2019) Downloads
Working Paper: The Gold Standard and the Great Depression: a Dynamic General Equilibrium Model (2019) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:ctl:louvir:2018016

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