Hostname: page-component-586b7cd67f-rcrh6 Total loading time: 0 Render date: 2024-11-24T18:45:53.286Z Has data issue: false hasContentIssue false
  • English
  • Français

Unemployment and Real Wages in the Great Depression

Published online by Cambridge University Press:  26 March 2020

Solomos Solomou  and
Martin Weale
Solomos Solomou*
Affiliation:
University of Cambridge
Martin Weale*
Affiliation:
NIESR
*
e-mail: [email protected]
e-mail: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

This article uses a dataset covering ten advanced economies (Australia, Belgium, Canada, France, Germany, Netherlands, Norway, Sweden, United Kingdom and the United States) to explore the role of real wages as an influence on employment and unemployment in the Great Depression and more generally in the 1920s and 1930s. The distinction between employment and unemployment movements during the Great Depression helps to clarify the role of supply side influences on the national heterogeneity of unemployment increases during the Great Depression. We find little general econometric evidence for the idea that movements in product wages had strong influences on employment either during the period of rising unemployment associated with the depression of the 1930s or more generally with the data which exist for the 1920s and 1930s.

Keywords

Great Depressionunemploymentemploymentreal wagesN12N14E24E32
Type
Research Articles
Information
National Institute Economic Review , Volume 214 , October 2010 , pp. R51 - R61
Copyright
Copyright © 2010 National Institute of Economic and Social Research

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Beenstock, M. and Warburton, P. (1986), ‘Wages and unemployment in interwar Britain’, Explorations in Economic History, 23, pp. 153–72.CrossRefGoogle Scholar
Bernanke, B.S. and Carey, K. (1996), ‘Nominal wage stickiness and aggregate supply in the Great Depression’, Quarterly Journal of Economics, Ill (3), pp. 853–83.CrossRefGoogle Scholar
Bernanke, B. and James, H. (1991), ‘The gold standard, deflation and financial crisis in the Great Depression: an international comparison’, in Hubbard, R.G. (ed.), Financial Crisis, Chicago.CrossRefGoogle Scholar
Butchart, E. (1997), ‘Unemployment and non-Employment in Interwar Britain’, Discussion Papers in Economic and Social History, University of Oxford. http://www.nuff.ox.ac.uk/economics/history/paper16/16www.pdf.Google Scholar
Chari, W., Kehoe, P.J. and McGrattan, E.R. (2007), ‘Business cycle accounting’, Econometrica, 75, pp. 781–836.CrossRefGoogle Scholar
Dimsdale, N.H. and Horsewood, N. (2002), ‘The causes of unemployment in interwar Australia’, The Economic Record, 78, 243, pp. 388–406.CrossRefGoogle Scholar
Dimsdale, N.H., Horsewood, N. and Van Riel, A. (2006), ‘Unemployment in interwar Germany: an analysis of the labor market, 1927-1936’, Journal of Economic History, 66, 3, pp. 778808.CrossRefGoogle Scholar
Eichengreen, B.J. and Hatton, T.J. (eds) (1988), Interwar Unemployment in International Perspective, Dordrecht and Boston, Martinus-Nijhoff.Google Scholar
Eichengreen, B. and Sachs, J. (1985), ‘Exchange rates and economic policy in the 1930s’, Journal of Economic History, 45, pp 925–46.CrossRefGoogle Scholar
Grytten, O.H. (1995), ‘The scale of Norwegian interwar unemployment in international perspective’, Scandinavian Economic History Review, 2, pp. 226–50.Google Scholar
Hatton, T.J. (1988), ‘A quarterly model of the labour market in interwar Britain’, Oxford Bulletin of Economics and Statistics, 50, pp.I-26.Google Scholar
Holland, D., Kirby, S. and Whitworth, R. (2010), ‘A comparison of labour market responses to the current downturn’, National Institute Economic Review, 211, pp. F38–42.CrossRefGoogle Scholar
Kehoe, T.J and Prescott, E.C. (2007), Great Depressions of the Twentieth Century, Minneapolis, Federal Reserve Bank of Minneapolis.CrossRefGoogle Scholar
Madsen, J.B. (2004), ‘Price and wage stickiness during the Great Depression’, European Review of Economic History, 8, 3, pp. 26396.CrossRefGoogle Scholar
OECD (2010), ‘Return to work after the crisis’, Chapter 5, Economic Outlook, pp. 251–92.CrossRefGoogle Scholar
Peasaran, M.H., Shin, Y. and Smith, R.P. (1999), ‘Pooled mean group estimation of dynamic heterogeneous panels’, Journal of the American Statistical Association, 94, pp. 621–34.Google Scholar
Reinhart, C.M. and Reinhart, V.R. (2009), ‘When the north last headed south: revisiting the 1930s’, Brookings Papers on Economic Activity, 2, pp. 251–72.Google Scholar
Topp, N.-H. (2008), ‘Unemployment and economic policy in Denmark in the 1930s’, Scandinavian Economic History Review, 56, I, pp. 71–90.CrossRefGoogle Scholar