TY  - JOUR
AU  - Bordo,Michael D.
AU  - Choudhri,Ehsan U.
AU  - Schwartz,Anna J.
TI  - Could Stable Money Have Averted The Great Contraction?
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 4481
PY  - 1995
Y2  - September 1995
UR  - http://www.nber.org/papers/w4481
L1  - http://www.nber.org/papers/w4481.pdf
N1  - Author contact info:
Michael D. Bordo
Department of Economics
Rutgers University
New Jersey Hall
75 Hamilton Street
New Brunswick, NJ 08901
Tel: 732/822-7152
Fax: 732/932-7416
E-Mail: bordo@econ.rutgers.edu

Anna J. Schwartz
NBER
365 Fifth Ave, 5th Floor
New York, NY  10016
Tel: 212/817-7957
Fax: 212/817-1597
E-Mail: aschwartz@gc.cuny.edu
AB  - We test the hypothesis that the Great Contraction would have been attenuated had the Fed not allowed the money stock to decline.  We do so by simulating a model that estimates separate relations for output and the price level and assumes that output and price dynamics are not especially sensitive to policy changes.  The simulations include a strong and a weak form of Friedman's constant money growth rule.  The results support the hypothesis that the Great Contraction would have been mitigated and shortened had the Fed followed a constant money growth rule.
ER  -