Change of Monetary Regime, Contracts, and Prices: Lessons from the Great Depression, 1932-1935

Abstract

I thank Michael Poyker for his assistance. I have benefitted from conversations with Ed Leamer, Al Harberger, George Tavlas, and an editor of this Journal. I thank the participants of the 23d Conference on Macroeconomic Analysis and International Finance, Rethymno, Crete, 2019. This paper draws partially on my keynote speech at the conference. The views expressed herein are those of the author and do not necessarily reflect the views of the National Bureau of Economic Research.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 They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

Measuring Inflation Expectations in Interwar Britain

“…The international evidence on policy regime change in the recovery profiles of the 1930s is mixed. The evidence for the United States suggests that a regime change in economic policy caused a shift in inflation expectations (Temin and Wigmore, 1990;Eggertsson, 2008;Romer, 2014;Jalil and Rua, 2016;Edwards, 2020). Shibamoto and Shizume (2014) argue that Japan benefited from a policy regime change correlated with devaluation in 1931.…”