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What caused the recovery from the British Great Depression? A leading explanation – the 'expectations channel' – suggests that a shift in expected inflation lowered real interest rates and stimulated consumption and investment. However, few studies have measured, or tested the economic consequences of, inflation expectations. In this paper, we collect high‐frequency information from primary and secondary sources to measure expected inflation in the United Kingdom between the wars. A high‐frequency vector autoregression suggests that inflation expectations were an important source of the early stages of economic recovery in interwar Britain. [ABSTRACT FROM AUTHOR]

This paper investigates therelationship between prosperity and national account data during wartime, focusing on Canada. In particular, we build off of existing literature arguing that military outlays must be excluded for real output measures to reasonably approximate economic prosperity. We analyse all non‐war components of Canadian gross national product during both world wars and estimate a novel price deflator for World War II in order to take into account wartime price controls. This allows us to obtain a new estimate of real output in Canada excluding military outlays. We then compare the trends in our new real output series with domestic private investment and stock market trends, all three of which either fell or grew at an anemic pace in Canada during both world wars. Combined, we argue that this provides evidence against the idea of wartime prosperity and more specifically, against the notion of World War II ending the Great Depression in Canada. [ABSTRACT FROM AUTHOR]

This paper investigates the role of sentiment in the US economy from 1920 to 1934 using digitised articles from The Wall Street Journal. We derive a monthly sentiment index and use a 10‐variable vector error correction model to identify sentiment shocks that are orthogonal to fundamentals. We show the timing and strength of these shocks and their resultant effects on the economy using historical decompositions. Intermittent impacts of up to 15 per cent on industrial production, 10 per cent on the S&P 500 and bank loans, and 37 basis points for the credit risk spread suggest a large role for sentiment. [ABSTRACT FROM AUTHOR]

This paper examines the Chicago sociologist William F. Ogburn's (1886–1959) views about technological unemployment, which were intimately connected to his analysis of the social impacts of technological developments and resulting social problems due to cultural lag. We trace the development of his views as seen through his well‐known 1922 book, Social Change with Respect to Culture and Original Nature, his important contributions to the President's Research Committee on Social Trends (1933), and his lesser‐known pamphlets designed for a broader audience—Living with Machines (1933), You and Machines (1934), and Machines and Tomorrow's World (1938). He used these pamphlets to educate the public about the dangers of new machines and technological unemployment. In doing so, he drew upon sociological analysis in his professional scholarly writings and his long‐standing personal interests in social betterment and social reform. Our analysis also calls into question the adequacy of existing scholarship on Ogburn that has emphasized his commitment to a statistical, dispassionate, and "objectivist" approach to social science research. We call for a revised, richer, and more complex view of Ogburn's work and legacy as one of the nation's leading social scientists during the first half of the 20th century. [ABSTRACT FROM AUTHOR]

A well‐established result in the literature is that Social Security reduces steady state welfare in a standard life cycle model. However, less is known about the historical quantitative effects of the program on agents who were alive when the program was adopted. In a computational life cycle model that simulates the Great Depression and the enactment of Social Security, this paper quantifies the welfare effects of the program's enactment on the cohorts of agents who experienced it. In contrast to the standard steady state results, we find that the adoption of the original Social Security generally improved these cohorts' welfare, in part because these cohorts received far more benefits relative to their contributions than they would have received if they lived their entire life in the steady state with Social Security. Moreover, the negative general equilibrium welfare effect of Social Security associated with capital crowd‐out was reduced during the transition, because it took many periods for agents to adjust their savings levels in response to the program's adoption. The positive welfare effect experienced by these transitional agents offers one explanation for why the program that may reduce welfare in the steady state was originally adopted. [ABSTRACT FROM AUTHOR]

Recent years have witnessed a revival of interest in the Great Depression of the 1930s. Among the differing new interpretations, the real business cycle (RBC) approach is particularly significant. It represents an outstanding methodological innovation in trying to cast the Great Depression within an ‘equilibrium’ framework. This paper critically reviews the RBC interpretation of the Great Depression, clarifying its theoretical and methodological foundations, and paving the way for future assessments of its validity. [ABSTRACT FROM AUTHOR]

This paper studies an early participatory rural development program implemented during the 1930s in Japan. This program selected several villages each year to draft and implement their own original development plans. I discuss the implications of the features of the program on its effectiveness. A detailed baseline survey conducted by the villagers themselves helped them to objectively diagnose their economic situations and understand their issues. The plans defined clear numerical targets, allowing them to share goals and monitor progress. The implementation of the plan was reinforced by frequent communication and monitoring among neighbors and by an incentive scheme that involved competition within a village. I use a village-level panel dataset from Hyogo Prefecture to examine the effects, under the difference-in-differences strategy. I find suggestive evidence that the program helped foster the adoption of cattle raising and diversify agricultural production. [ABSTRACT FROM AUTHOR]

Building and loan associations (B&Ls) financed over half of new houses constructed in the United States during the 1920s but they lost their predominance within the following decades as they were pushed to convert into Savings and Loans (S&Ls). This study examines whether the U.S. government‐insured Postal Savings System attracted funds away from B&Ls precisely when they needed them the most in the Great Depression. Annual town‐ and county‐level data from 1920 through 1935 for three states show that the sudden rise in local postal savings was associated with local downturns in B&Ls. Using a panel vector autoregression, we find that postal savings significantly reduced the amount of money in B&Ls, yet B&Ls had no significant effect on postal savings banks. Alternatively, postal savings had no significant effect on commercial banks. The results suggest that this competitive dynamic prevented B&Ls from rebounding in the mid‐1930s and helped contributed to Great Depression's local real estate lending decline. [ABSTRACT FROM AUTHOR]

Unprecedented liquidity injections by central bankers have gained legitimacy in recent years to stave off economic crisis and enjoy strong support from prominent economists and economic historians. Such radical action by central bankers is underpinned by a remarkable agreement on a specific interpretation of the Great Depression of the 1930s in the US, an interpretation proposed by Milton Friedman and Anna Schwartz in A monetary history of the United States (1963). This article explores the origins, the limits, and the influence of A monetary history's interpretation of the Great Depression for the insights it offers on theory and history in the study of economic life. The book was inspired by Wesley Clair Mitchell's mobilization of historical research to insist on the inherent instability of capitalism. Friedman and Schwartz exploited the heretical potential of historical research to dismiss any claim that the crisis reflected a systemic dysfunction of the US economy. Now that their interpretation has become our orthodoxy, this article shows how we can develop the fertile link between history and heresy to open up new lines of research on the causes of the greatest crisis in the history of capitalism. [ABSTRACT FROM AUTHOR]

It is clear that we are facing a tipping point in global politics, climate change and social justice. Much has been trumpeted under the banner of the 'Green New Deal'. Billy Fleming, the Wilks Family Director of the Ian L McHarg Center at the Weitzman School of Design, University of Pennsylvania, describes the history and various approaches encompassed within this ubiquitous epithet and how designers can get involved. [ABSTRACT FROM AUTHOR]

Although some regard the New Deal of the 1930s as exemplifying an aggressive fiscal and monetary response to a severe economic crisis, the US fiscal and monetary policy responses to the COVID‐19 crisis have actually been far more substantial – and, so far, much more effective in reviving aggregate spending. Although many fear that these responses, and the large‐scale increase in bank reserves especially, must eventually cause unwanted inflation, the concurrent sharp decline in money's velocity has thus far more than offset any inflationary effects of money growth, while forward bond prices reflect a general belief that inflation will remain below 2 per cent for at least another decade. Notwithstanding the growth of the Fed's balance sheet, Fed authorities can always check inflation by sufficiently raising the interest return on bank reserves. Nonetheless, recent developments have heightened the risk of 'fiscal dominance' of monetary policy at some point in the future. [ABSTRACT FROM AUTHOR]

Early in his career, Hayek viewed attempts to stabilize exchange rates by facilitating cooperation between central banks, with respect to their demand for gold, to be at odds with the fundamental mechanisms of the gold standard. He opposed proposals by Irving Fisher, Gustav Cassel, and Ralph Hawtrey that promoted stabilization of demand for gold and price levels as a next best option. Hayek viewed the nations that refused to devalue their currency after monetary expansion during wartime as complicit in degrading the international gold standard. In 1935 Hayek's emphasis began to change, his position sounding much like the arguments of Cassel and Hawtrey. Though he eventually gave up hope that the international gold standard would be reestablished, his later work on money provides theoretical underpinnings for systems that would promote the same sort of stability and predictability that the classical gold standard had provided. [ABSTRACT FROM AUTHOR]

Calls to reinvent architectural practice have been a steady part of the profession from its inception. Widely published cultural writer Douglas Murphy, who teaches in the architecture departments of the Royal College of Art and Central Saint Martins in London, tracks the variety of forms they have taken: from reactions to specific historical and technical developments, to perennial concerns regarding the architect's standing in society and on the building site. [ABSTRACT FROM AUTHOR]

The concept of a 'secondary deflation' was developed in the 1930s by the German economist Wilhelm Röpke, who saw it as something different from a normal depression. While a primary deflation is a necessary reaction to the inflation from a boom period, a secondary deflation is independent and economically purposeless. Röpke argued that secondary depressions occurred in the US, Germany, France and Switzerland during the 1930s, but was vague on what made them follow primary depressions. Recently, the Taiwanese-American economist Richard C. Koo has claimed to have discovered the ' Holy Grail of macroeconomics', that is, what made the Great Depression so deep and long. During the Great Depression, the bursting of the asset price bubble resulted in private sectors having more debt than assets; as they shifted from maximising profits to minimising debt, the consequent debt deflation shrank the economy. According to Koo, Western economies today are suffering from a similar 'balance sheet recession'. Strengthened by the notion of a balance sheet recession, Röpke's long-lost insights might advance our understanding of the business cycle in general and the present crisis in the US and the Eurozone in particular. [ABSTRACT FROM AUTHOR]

Who benefits from deep economic crises: the left, the right or neither? On the basis of evidence from elections in 1929-1933 and 2008-2013 in all states that were democracies in both periods, it is argued in this article that the electoral consequences of the Great Depression and the Great Recession were surprisingly similar: in both periods, right-wing parties were at first more successful than left-wing parties, although this effect only lasted for a few years. The manner in which a crisis develops over time should be taken into account when examining the effects of deep economic downturns on the electoral fortunes of the left and the right. [ABSTRACT FROM AUTHOR]

I compare and contrast relief efforts by governments in response to the extraordinary unemployment of the Great Depression in the US and Australia. The effectiveness of relief spending in America at the local level is discussed using recent studies estimating the relationship between relief spending and various demographic measures. I develop a new panel data set for the Australian states from 1929 through 1939. Increased income in manufacturing and rural production were associated with lower infant mortality rates and death rates and higher fertility rates. In contrast to the US experience, however, higher per capita relief spending was associated with lower birth rates. [ABSTRACT FROM AUTHOR]

This article provides a primer on budget deficits from the creation of the federal government. Today federal government spending is 24% of GDP (compared with its historical average of 8.8%), fuelling debt of historic levels. The only effective way to reduce debt levels is to cut entitlement programmes and then set a tax rate sufficient, over the course of the business cycle, to fund government spending. [ABSTRACT FROM AUTHOR]

Contrary to some accounts, the Hayek–Robbins (“Austrian”) theory of the business cycle did not prescribe a monetary policy of “liquidationism” in the sense of passive indifference to sharp deflation during the early years of the Great Depression. There is no evidence that Hayek or Robbins influenced any “liquidationist” in the Hoover administration or the Federal Reserve System. Federal Reserve policy during the Great Depression was instead influenced by the real bills doctrine, which (despite some apparent similarities) was diametrically opposed in key respects to Hayek's norms for central bank policy. [ABSTRACT FROM AUTHOR]

The resource constraint version of the disadvantage theory of entrepreneurship holds that members of destitute ethnic groups often respond to labor market exclusion by becoming “survivalist entrepreneurs,” that is, persons who start marginal businesses in response to a need to become self-employed. Applying this theory, I analyze survivalist entrepreneurship among Black women in the urban North during the Great Depression, when many Black women had to find an independent means of livelihood. I hypothesize that (1) the participation of Black women in entrepreneurial occupations, i.e., occupations that lend themselves to self-employment, was positively associated with the disadvantage of these women in the labor market and (2) Black women would be inclined to participate in those entrepreneurial occupations with low barriers to entry, namely, boarding and lodging house keeping and hairdressing and beauty culture. These occupations, according to a review of historical studies, provided northern Black women with their best opportunities for survivalist entrepreneurship. The analyses of census data support my hypotheses and suggest that the resource constraint version of the disadvantage theory of entrepreneurship is relevant to the economic adjustment strategies of northern Black women during the nation's worst employment crisis. [ABSTRACT FROM AUTHOR]