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The Slide to Protectionism in the Great Depression: Who Succumbed and Why?

  • Barry Eichengreen
  • Douglas A. Irwin

The Great Depression was marked by a severe outbreak of protectionist trade policies. But contrary to the presumption that all countries scrambled to raise trade barriers, there was substantial cross-country variation in the movement to protectionism. Specifically, countries that remained on the gold standard resorted to tariffs, import quotas, and exchange controls to a greater extent than countries that went off gold. Gold standard countries chose to maintain their fixed exchange rate and reduce spending on imports rather than allow their currency to depreciate. Trade protection in the 1930s was less an instance of special interest politics than second-best macroeconomic policy when monetary and fiscal policies were constrained.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 15142.

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Date of creation: Jul 2009
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Publication status: published as Eichengreen, Barry & Irwin, Douglas A., 2010. "The Slide to Protectionism in the Great Depression: Who Succumbed and Why?," The Journal of Economic History, Cambridge University Press, vol. 70(04), pages 871-897, December.
Handle: RePEc:nbr:nberwo:15142
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