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Going Dutch: monetary policy in the Netherlands during the interwar gold standard, 1925–1936

Author

Listed:
  • Fliers, Philip T.
  • Colvin, Christopher L.

Abstract

Our study of the day-to-day management of monetary policy in the Netherlands between 1925 and 1936 reveals that policy leaders and central bankers were both willing and able to deviate from the monetary policy paths set by other countries, all while remaining firmly within the gold bloc. The Netherlands wielded an independent monetary policy while remaining on gold thanks to its central bank's plentiful gold reserves. Central bankers quelled any speculation against the guilder by exploiting their domestic policy influence and international reputation to restrict capital mobility. However, maintaining pre-war parity until the collapse of the gold standard in September 1936 came at a cost. Our international comparisons and counterfactual analysis suggest that Dutch officials would have avoided a deepening of the Great Depression by leaving gold alongside the UK in 1931.

Suggested Citation

  • Fliers, Philip T. & Colvin, Christopher L., 2022. "Going Dutch: monetary policy in the Netherlands during the interwar gold standard, 1925–1936," Financial History Review, Cambridge University Press, vol. 29(2), pages 121-151, August.
    • Handle: RePEc:cup:fihrev:v:29:y:2022:i:2:p:121-151_1
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    Cited by:

    1. Christie Swanepoel & Philip T. Fliers, 2021. "The fuel of unparalleled recovery: Monetary policy in South Africa between 1925 and 1936," Economic History of Developing Regions, Taylor & Francis Journals, vol. 36(2), pages 213-244, May.
    2. Weinan Yan, 2022. "Inequality and the Interwar Gold Standard," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 48(1), pages 90-121, January.
    3. Brownlow, Graham & Colvin, Christopher L., 2022. "Economic history and the future of pedagogy in economics," QUCEH Working Paper Series 22-09, Queen's University Belfast, Queen's University Centre for Economic History.
    4. Wilco Legierse, 2023. "Offering Method and Pricing of IPOs: An Analysis of Stock IPOs in the Netherlands, 1918–1939," De Economist, Springer, vol. 171(3), pages 207-238, September.
    5. Paweł Kowalewski, 2024. "Relationship between central banks’ activities and their profitability," Bank i Kredyt, Narodowy Bank Polski, vol. 55(3), pages 221-254.
    6. Colvin, Christopher L. & Winfree, Paul, 2019. "Applied history, applied economics, and economic history," QUCEH Working Paper Series 2019-07, Queen's University Belfast, Queen's University Centre for Economic History.

    More about this item

    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
    • N14 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Europe: 1913-
    • N20 - Economic History - - Financial Markets and Institutions - - - General, International, or Comparative
    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions

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