Unemployment, Inflation, and Wages in the American Depression: Are There Lessons for Europe?
Abstract
In this paper, we consider whether there are lessons to be drawn from the experience of the American economy during the 1930's for the current European situation. The comparison reveals some important differences: In particular, the persistence of American unemployment in the 1930's reflected to a much greater degree a sequence of large destabilizing shocks, and much less a low-level equilibrium trap, than does modern European unemployment. The self-correcting tendencies of the 1930's U.S. economy were probably much stronger than is generally acknowledged. However, the experience of the Depression era confirms the modern observation that the level of unemployment does not much affect the rate of inflation--an observation that, we argue, is consistent with macro theory. The Depression experience also supports the impression that political factors are important in real wage determination.(This abstract was borrowed from another version of this item.)
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Bibliographic Info
Article provided by American Economic Association in its journal American Economic Review.
Volume (Year): 79 (1989)
Issue (Month): 2 (May)
Pages: 210-14
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Related research
Keywords:Other versions of this item:
- Ben Bernanke & Martin Parkinson, 1989. "Unemployment, Inflation, and Wages in the American Depression: Are There Lessons for Europe?," NBER Working Papers 2862, National Bureau of Economic Research, Inc.
References
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- Peter Temin & Barrie A. Wigmore, 1988. "The End of One Big Deflation," Working papers 503, Massachusetts Institute of Technology (MIT), Department of Economics.
Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Alfonso ARPAIA & Nicola CURCI, .
"EU labour market behaviour during the Great Recession,"
Working Papers
wp2010-6, Department of the Treasury, Ministry of the Economy and of Finance.
- Arpaia, Alfonso & Curci, Nicola, 2010. "EU labour market behaviour during the Great Recession," MPRA Paper 22393, University Library of Munich, Germany.
- Alfonso Arpaia & Nicola Curci, 2010. "EU labour market behaviour during the Great Recession," European Economy - Economic Papers 405, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.
- Antonio Spilimbergo & Steven A. Symansky & Carlo Cottarelli & Olivier J. Blanchard, 2009.
"Fiscal Policy for the Crisis,"
IMF Staff Position Notes
2008/01, International Monetary Fund.
- Antonio Spilimbergo & Steve Symansky & Olivier Blanchard & Carlo Cottarelli, 2009. "Fiscal Policy For The Crisis," CESifo Forum, Ifo Institute for Economic Research at the University of Munich, vol. 10(2), pages 26-32, 07.
- Blanchard, Olivier J & Cottarelli, Carlo & Spilimbergo, Antonio & Symansky, Steven, 2009. "Fiscal Policy for the Crisis," CEPR Discussion Papers 7130, C.E.P.R. Discussion Papers.
- Robert A. Margo, 1992.
"Employment and Unemployment in the 1930s,"
NBER Working Papers
4174, National Bureau of Economic Research, Inc.
- Robert A. Margo, 1993. "Employment and Unemployment in the 1930s," Journal of Economic Perspectives, American Economic Association, vol. 7(2), pages 41-59, Spring.
- Christina D. Romer, 1991.
"What Ended the Great Depression?,"
NBER Working Papers
3829, National Bureau of Economic Research, Inc.
- Romer, Christina D., 1992. "What Ended the Great Depression?," The Journal of Economic History, Cambridge University Press, vol. 52(04), pages 757-784, December.
- Price V. Fishback & William C. Horrace & Shawn Kantor, 2001. "The Impact of New Deal Expenditures on Local Economic Activity: An Examination of Retail Sales, 1929-1939," NBER Working Papers 8108, National Bureau of Economic Research, Inc.
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