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I'm actually genuinely curious what research and theory you are referring to, and I wouldn't know where to start looking. Could you give me some pointers?

begurken 14y ago
From Wikipedia: http://en.wikipedia.org/wiki/Causes_of_the_Great_Depression http://en.wikipedia.org/wiki/Causes_of_the_Great_Depression "In their 1963 book A Monetary History of the United States, 1867-1960, Milton Friedman and Anna Schwartz laid out their case for a different explanation of the Great Depression. Essentially, the Great Depression, in their view, was caused by the fall of the money supply. Friedman and Schwartz write: "From the cyclical peak in August 1929 to a cyclical trough in March 1933, the stock of money fell by over a third." The result was what Friedman calls the "Great Contraction" — a period of falling income, prices, and employment caused by the choking effects of a restricted money supply. Friedman and Schwartz argue that people wanted to hold more money than the Federal Reserve was supplying. As a result people hoarded money by consuming less. This caused a contraction in employment and production since prices were not flexible enough to immediately fall." Here's a video of Milton Friedman (he won a Nobel Prize for this work) explaining how monetary contraction caused the great depression: https://www.youtube.com/watch?v=O7pnjzCuSv8 https://www.youtube.com/watch?v=O7pnjzCuSv8 "By 1933, the quantity of money in the United States had gone down by a third." ... "For every 3 dollars of currency and deposits that people had had in 1929, only 2 dollars were left." One thing people often forget about deflation is that a general decline in the level of prices also includes labour prices and interest rates. It is characterised by zero interest rates, falling prices, falling wages, and because wages are 'sticky-down', high unemployment. You really do not want to live in a deflationary economy unless you have a large pile of cash. It's miserable. A second, and in my view, more valid definition of deflation is a contraction of the money supply. Ben Bernanke (current Fed Chairman) is an expert on causes of the great depression, and has been doing everything he can to ensure that the US money supply does not shrink.
cmccabe 14y ago
You could start with Friedrich Hayek and the Austrian school if you're interested in a serious defense of anti-Keynesianism. Note: I'm not saying I agree with them, just answering your question.
tatsuke95 14y ago
You can start with anything by Bernanke related to the subject, both writings and speeches.

begurken 14y ago

From Wikipedia: http://en.wikipedia.org/wiki/Causes_of_the_Great_Depression http://en.wikipedia.org/wiki/Causes_of_the_Great_Depression "In their 1963 book A Monetary History of the United States, 1867-1960, Milton Friedman and Anna Schwartz laid out their case for a different explanation of the Great Depression. Essentially, the Great Depression, in their view, was caused by the fall of the money supply. Friedman and Schwartz write: "From the cyclical peak in August 1929 to a cyclical trough in March 1933, the stock of money fell by over a third." The result was what Friedman calls the "Great Contraction" — a period of falling income, prices, and employment caused by the choking effects of a restricted money supply. Friedman and Schwartz argue that people wanted to hold more money than the Federal Reserve was supplying. As a result people hoarded money by consuming less. This caused a contraction in employment and production since prices were not flexible enough to immediately fall." Here's a video of Milton Friedman (he won a Nobel Prize for this work) explaining how monetary contraction caused the great depression: https://www.youtube.com/watch?v=O7pnjzCuSv8 https://www.youtube.com/watch?v=O7pnjzCuSv8 "By 1933, the quantity of money in the United States had gone down by a third." ... "For every 3 dollars of currency and deposits that people had had in 1929, only 2 dollars were left." One thing people often forget about deflation is that a general decline in the level of prices also includes labour prices and interest rates. It is characterised by zero interest rates, falling prices, falling wages, and because wages are 'sticky-down', high unemployment. You really do not want to live in a deflationary economy unless you have a large pile of cash. It's miserable. A second, and in my view, more valid definition of deflation is a contraction of the money supply. Ben Bernanke (current Fed Chairman) is an expert on causes of the great depression, and has been doing everything he can to ensure that the US money supply does not shrink.

cmccabe 14y ago

You could start with Friedrich Hayek and the Austrian school if you're interested in a serious defense of anti-Keynesianism. Note: I'm not saying I agree with them, just answering your question.

tatsuke95 14y ago

You can start with anything by Bernanke related to the subject, both writings and speeches.