The Ends of 27 Big Depressions
How did countries recover from the Great Depression? In this paper we explore the argument that leaving the gold standard helped by boosting inflationary expectations and lowering real interest rates. We do so for a sample of 27 countries, using modern nowcasting methods and a new data set containing more than 230, 000 monthly and quarterly observations for over 1, 500 variables. In those cases where the departure from gold happened on clearly defined dates, it seems clear that inflationary expectations rose in the wake of departure. IV, diff-in-diff, and synthetic matching techniques suggest that the relationship is causal.
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Copy CitationMartin Ellison, Sang Seok Lee, and Kevin Hjortshøj O'Rourke, "The Ends of 27 Big Depressions," NBER Working Paper 27586 (2020), https://doi.org/10.3386/w27586.Download Citation
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Published Versions
Martin Ellison & Sang Seok Lee & Kevin Hjortshøj O'Rourke, 2024. "The Ends of 27 Big Depressions," American Economic Review, American Economic Association, vol. 114(1), pages 134-168, January. citation courtesy of 
Martin Ellison & Sang Seok Lee & Kevin Hjortshøj O’Rourke, 2024. "The Ends of 27 Big Depressions," American Economic Review, vol 114(1), pages 134-168.
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