The Gold-Exchange Standard and the Great Depression

50 Pages Posted: 7 Aug 2007 Last revised: 3 Jan 2022

See all articles by Barry Eichengreen

Barry Eichengreen

University of California, Berkeley; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Date Written: March 1987


A number of explanations for the severity of the Great Depression focus on the malfunctioning of the international monetary system. One such explanation emphasizes the deflationary monetary consequences of the liquidation of foreign-exchange reserves following competitive devaluations by Great Britain and her trading partners. Another emphasizes instead the international monetary policies of the Federal Reserve and the Rank of France. This paper analyzes both the exceptional behavior of the U.S. and France and the shift out of foreign exchange after 1930. While both Franco-American gold policies and systemic weaknesses of the international monetary system emerge as important factors in explaining the international distribution of reserves, the first of these factors turns out to play the more important role in the monetary stringency associated with the Great Depression.

Suggested Citation

Eichengreen, Barry, The Gold-Exchange Standard and the Great Depression (March 1987). NBER Working Paper No. w2198, Available at SSRN:

Barry Eichengreen (Contact Author)

University of California, Berkeley ( email )

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Berkeley, CA 94720
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National Bureau of Economic Research (NBER)

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Centre for Economic Policy Research (CEPR)

United Kingdom

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