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The origins and nature of the Great Slump revisited

1992; Wiley; Volume: 45; Issue: 2 Linguagem: Inglês

10.1111/j.1468-0289.1992.tb01299.x

1468-0289

Barry Eichengreen,

Economic Theory and Institutions

M ore than a decade has passed since the Economic History Society last published a survey of the depression of the I930s. That survey, Fearon's The origins and nature of the Great Slump, I929-I932, proved to be one of the best-selling titles in the 'Studies in Economic and Social History' series sponsored by the Society.2 The appeal of Fearon's pamphlet was that it treated the Depression of the I930s as a global phenomenon. Rather than focusing on events in the United States, as had the most influential works of preceding years, Fearon treated the US as but one of many countries succumbing to the slump and emphasized the linkages between them.3 He resurrected an earlier literature in which the depression of the I930S was seen as resulting from instabilities that had developed over the course of previous decades. Implicit in his account, fully half of which was devoted to World War i and the I920S, was the notion that the origins of the slump were somehow connected to structural features of the interwar economy. A disturbing feature of Fearon's survey was the lack of consensus it revealed on the central issues. The events requiring explanation were clearly identified: the onset of the slump, the persistent downward spiral, the inception of recovery. But for each of these events there seemed to be many potential explanations and little agreement among scholars. The reader may ask, given this state of affairs, what justifies another survey of such familiar terrain. The answer, I contend, is that the last decade has witnessed a hidden revolution in our understanding of the macroeconomics of the I930s. On many of the central issues raised by the earlier literature, a striking degree of consensus has emerged. There are two reasons for using Fearon's pamphlet as the point of departure for this survey. First, in his attempt to view the Depression as a global phenomenon and to link the economic crisis of the I930S to developments in previous decades, he anticipated trends in the subsequent literature. Second, the comparison serves to highlight how much attention