Reconstruction Finance Corporation Assistance to Financial Intermediaries and Commercial & Industrial Enterprise in the US, 1932-1937

48 Pages Posted: 4 Feb 2009

See all articles by Joseph R. Mason

Joseph R. Mason

Louisiana State University - Ourso School of Business; University of Pennsylvania - Wharton Financial Institutions Center

Date Written: January 17, 2000

Abstract

Many have attempted to distill lessons on combating economic crises from the experiences of the US Reconstruction Finance Corporation (RFC) during the 1930s. However, the resulting policies have been subject to widespread doubts and criticisms. Many economic historians doubt RFC assistance to financial intermediaries and commercial & industrial firms contributed a great deal to stabilizing the US economy during the Great Depression. RFC assistance probably did not, therefore, form a significant basis for the general economic recovery to follow. The present essay does not dispute that point. However, between 1932 and 1937, the RFC experimented with a wide variety of programs targeted toward resolving systemic distress. It did so by attempting to stimulate credit and capital market activity through acting as a lender of last resort, recapitalizing the banking industry, and providing direct credit to commercial and industrial enterprises.

Keywords: Reconstruction Finance Corporation, Great Depression, Crisis, Finance, Banking, Banks, Policy

JEL Classification: G21, G28, G32

Suggested Citation

Mason, Joseph R., Reconstruction Finance Corporation Assistance to Financial Intermediaries and Commercial & Industrial Enterprise in the US, 1932-1937 (January 17, 2000). Available at SSRN: https://ssrn.com/abstract=1337171 or http://dx.doi.org/10.2139/ssrn.1337171

Joseph R. Mason (Contact Author)

Louisiana State University - Ourso School of Business

2900 Business Education Complex
Baton Rouge, LA 70803
United States
202-683-8909 (Phone)

University of Pennsylvania - Wharton Financial Institutions Center ( email )

3641 Locust Walk
Philadelphia, PA 19104-6218
United States

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