TY  - JOUR
AU  - Richardson,Gary
AU  - Troost,William
TI  - Monetary Intervention Mitigated Banking Panics During the Great Depression: Quasi-Experimental Evidence from the Federal Reserve District Border in Mississippi, 1929 to 1933
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 12591
PY  - 2006
Y2  - October 2006
UR  - http://www.nber.org/papers/w12591
L1  - http://www.nber.org/papers/w12591.pdf
N1  - Author contact info:
Gary Richardson
Department of Economics
University of California, Irvine
3155 Social Sciences Plaza
Irvine, CA 92697-5100
Tel: 949/824-3189
Fax: 949/824-2182
E-Mail: garyr@uci.edu

William Troost
UC, Irvine
E-Mail: wtroost@uci.edu
AB  - The Federal Reserve Act of 1913 divided Mississippi between the 6th (Atlanta) and 8th (St. Louis) Federal Reserve Districts. Before and during the Great Depression, these districts' policies differed. The Atlanta Fed championed monetary activism and the extension of credit to troubled banks. The St. Louis Fed adhered to the doctrine of real bills and eschewed expansionary initiatives. Outcomes differed across districts. In the 6th District, banks failed at lower rates than in the 8th District, particularly during the banking panic in the fall of 1930. The pattern suggests that discount lending reduced failure rates during periods of panic. Historical evidence and statistical analysis corroborates this conclusion.
ER  -