1930: First Modern Crisis

Abstract

1999). Also, thanks to Mrdjan Mladjan for sharing his data on the instruments used in . The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.At least one co-author has disclosed a financial relationship of potential relevance for this research. Further information is available online at http://www.nber.org/papers/w25452.ack NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

The Regulation of Private Money*

“…While subsequent researchers did pick over the carcass of the Great Depression, this work did not address the central question of the role of financial crises in business cycles generally. Largely this was because the history of crises prior to the Great Depression were not studied, making the Great Depression seem extremely unusual (see Gorton, Laarits, and Muir 2019).…”

Money, Banking, and Old-School Historical Economics

“…Recent papers study the effect of the US banking crises during the Great Depression using the identification method of Rajan and Zingales (Benmelech, Frydman, and Papanikolaou 2019;Gorton, Laarits, and Muir 2019): firms that relied more on external financing were more affected by banking crises than others. The challenge of this empirical method is to control for all the characteristics of firms that can be jointly associated with the choice of the composition of liabilities and the performance of firms.…”

The Regulation of Private Money

“…Largely this was because the history of crises prior to the Great Depression were not studied, making the Great Depression seem extremely unusual. See Gorton, Laarits, and Muir (2019).…”