Some Observations on the Great Depression in Germany

No 3716, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This Paper evaluates the role of the demand side during the Great Depression in Germany. From Euler equation residuals we are able to identify a series of contractionary demand shocks that pounded the German economy from 1929-32. We apply the detrimental preference innovations to a dynamic general equilibrium model and find that size and order of shocks can generate a pattern that can explain the lion?s share of the decline in economic activity. The artificial economy also predicts a swift recovery after 1932, thereby questioning significant effects of Nazi economic policy.

Keywords: Demand shocks; Great depression; Germany; Applied dynamic general equilibrium (search for similar items in EconPapers)
JEL-codes: E32 N14 (search for similar items in EconPapers)
Date: 2003-01
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Citations: View citations in EconPapers (5)

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Related works:
Journal Article: Some Observations on the Great Depression in Germany (2006)
Journal Article: Some Observations on the Great Depression in Germany (2006)
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