Scylla and Charybdis: Explaining Europe's Exit from Gold, January 1928 - December 1936
Humboldt University Berlin - Department of Economics; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); London School of Economics - Centre for Economic Performance (CEP)
CEPR Discussion Paper No. DP6685
The paper examines the timing of exit from the interwar gold-exchange standard for a panel of European countries, based on monthly data over the period January 1928 - December 1936. I show that the decision of exit from gold can be understood in terms of a trade-off between a quite limited set of factors commonly suggested in the theoretical literature on currency crises. A simple and parsimonious econometric framework that nests various hypotheses allows predicting the very month when a country will exit gold in the 1930s.
Number of Pages in PDF File: 42
Keywords: Europe, Gold-Exchange Standard, Interwar Period
JEL Classification: E42, E44, N14working papers series
Date posted: June 9, 2008
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