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When scholars investigate the legacy of John Maynard Keynes’s Treatise on Probability (1921) for the development of Keynes’s thinking, the attention usually focuses on the connections among Keynes’s probability theory, his conception of decision-making under uncertainty, and the theory of the functioning of the macroeconomic system that derives from it—through the marginal efficiency of capital, the preference for liquidity, and the self-referential functioning of financial markets. By contrast, this paper aims to investigate the connections between Keynes’s probability theory, on the one hand, and his economic policy recommendations, on the other. It concentrates on the policy recommendations defended by Keynes during the Great Depression but also after the General Theory. Keynes’s economic policy can be understood as a framework for decision-making in situations of uncertainty: fiscal policy aims to induce private agents to change their “rational” probability statements, while monetary policy aims to allow more weight to these statements.

This paper analyzes how risk premiums altered the use of commercial paper relative to bank loans during the recent financial crisis. Consistent with the theoretical and empirical literature on how surges in risk premiums can induce plunges in under-collateralized credit or credit funded with noninsured sources, results indicate that a spike in risk premiums induced a plunge in commercial paper use during the recent crisis. This paper also finds that Federal Reserve interventions in the money market helped prevent the commercial paper market from melting down to the extent seen during the early 1930s.

During the years 1918 to 1941, International Paper (IP) launched a massive product diversification effort. Engineered by three successive presidents, diversification turned the company from a newsprint producer based in the northeastern United States into an international manufacturer of southern kraft grades, Canadian newsprint, hydroelectric power, and specialty papers. With the exception of kraft paperboard and converted products, however, the new product lines failed to provide IP with a firm foothold in markets for consumer nondurables, where nimbler competitors thrived even during the 1930s. IP and firms in other “maturing industries” that clung to traditional products and stagnant markets contributed to the length and severity of the Great Depression.

In a world where the arts have become one more target for multimedia corporations it is worth remembering the more authentic intertextuality of works which appeared around 1940, i.e. John Steinbeck’s The Grapes of Wrath, Darryl F. Zanuck and John Ford’s film of the same name, and the songs of Woody Guthrie. Never before had literature, cinema and song been so intimately and powerfully linked, and nothing since has come near to replicating this unique symbiosis.

This paper 1 is an interesting and unusual data set that raises a number of questions, only some of which are answerable. Life expectancy has steadily increased from 1900 to 2000, while infant mortality has also steadily improved. Suicide rates have not kept pace with this general improvement in health by showing similar linear decreases. If we disregard the major reductions in suicide rates in both world wars, more pronounced for males than females, we can say that male rates rose steadily from 1863 to 1905, but had returned to 1905 levels by 1937 during the Great Depression. Since then, however, the reduction in the male rates has been steady and sustained. Female rates rose gradually from 1863 to 1967, with smaller decreases during the world wars, and have fallen fairly steadily since then. The progressive increase in suicide rates in the earlier period is not easy to account for in terms of what is known about risk factors for suicide.

We describe in this essay why the gold standard and the euro are extreme forms of fixed exchange rates, and how these policies had their most potent effects in the worst peaceful economic periods in modern times. While we are lucky to have avoided another catastrophe like the Great Depression in 2008--9, mainly by virtue of policy-makers' aggressive use of monetary and fiscal stimuli, the world economy is still experiencing many difficulties. As in the Great Depression, this second round of problems stems from the prevalence of fixed exchange rates. Fixed exchange rates facilitate business and communication in good times but intensify problems when times are bad. Copyright 2010, Oxford University Press.

The National Security Strategy of the United States cites sustained economic growth and prosperity as a vital national objective. Key to economic growth and prosperity is a healthy financial services sector. History shows that a weak financial sector can exacerbate economic downturns. Weaknesses in the US banking system greatly aggravated the United States' difficulties during the Great Depression. Other historical examples include Mexico, Russia, Argentina, and Japan; in all cases, weak financial systems have contributed significantly to economic problems and overall loss of influence on the world stage. Therefore, assessing the health of the financial services industry is an important step in assuring continued U.S. national power, prosperity, influence, and security. The research supporting this paper included individual examination of key issues facing the industry by the 16 seminar members as well as field research in Washington, D.C., New York, Chicago, Hong Kong, and Tokyo. The seminar visited financial institutions that make up the industry, governmental, quasi-governmental, other regulatory agencies, and financial industry associations in order to get a complete picture of the complicated, highly interconnected structure of the industry. The paper begins by describing the basic components and health of the financial services industry. It continues with a discussion of the major challenges facing the industry, what role the government plays in the industry, and the outlook for the future. Short essays addressing the most pressing issues facing the industry, both domestically and internationally, precede an overall conclusion.