The gold standard as a rule

Michael Bordo and Finn Kydland

No 9205, Working Papers (Old Series) from Federal Reserve Bank of Cleveland

Abstract: In this paper, we show that the monetary rule followed by a number of key countries before 1914 represented a commitment technology preventing the monetary authorities from changing planned future policy. The experiences of these major countries suggest that the gold standard was intended as a contingent rule. By that, we mean that the authorities could temporarily abandon the fixed price of gold during a wartime emergency on the understanding that convertibility at the original price of gold would be restored when the emergency passed.

Keywords: Gold standard; Economic history; Monetary policy (search for similar items in EconPapers)
Date: 1992
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Working Paper: The Gold Standard as a Rule (1990)
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