Lessons from the Great Depression

by Peter Temin

Lessons from the Great Depression provides an integrated view of the depression, covering the experience in Britain, France, Germany, and the United States. Do events of the 1930s carry a message for the 1990s? Lessons from the Great Depression provides an integrated view of the depression, covering the experience in Britain, France, Germany, and the United States. It describes the causes of the depression, why it was so widespread and prolonged, and what brought about eventual recovery. Peter Temin also finds parallels in recent history, in the relentless deflationary course followed by the U.S. Federal Reserve Board and the British government in the early 1980s, and in the dogged adherence by the Reagan administration to policies generated by a discredited economic theory--supply-side economics.

Genres: Economics, History

211 pages, Paperback

First published December 1, 1989

About the author

Peter Temin was an economist and economic historian, serving as the Gray Professor Emeritus of Economics at MIT, where he was formerly the head of the Economics Department.

Reviews

[AustrianHistorian · Rating 4 out of 5]

Merece la pena por el análisis económico (aunque no siempre convincente) de la segunda lección y la primera mitad de la tercera. En el apéndice I expone los modelos macroeconómicos subyacentes a las lecciones (revisiones del modelo IS-LM), lo cual no está mal si uno pretende emprender una lectura completa de la bibliografía especializada.

[James · Rating 4 out of 5]

Just like The Wretched of the Earth (and for that matter, Being and Having: An Existentialist Diary), this book was slow and technical for a long time, but the last lecture was great for me. I simply lack the economics background for a lot of the details throughout the book, but have enough I guess to get some basic ideas, some "Lessons from Lessons from the Great Depression":

1. A breakdown in a system can come from a shock. The shock might be propagated in a not-so-obvious way, perhaps by something seemingly innocent.

2. Or, a system can break down because it has become unstable. Then, anything can make it break down.

(#1 is Temin’s point, #2 is an alternative that he rejects.)

3. When things start going bad, when a systemic breakdown sets in, you think things are going to get better. Then, after a while, “reality sets in” that they aren’t going to get better.

4. People are rational, to a point. People prone to rationality still need the relevant evidence before they can make sound decisions. The evidence isn’t even enough for them if they don’t have good models underlying their interpretation of the evidence.

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And even more good stuff in the last lecture which I won't spoil -- you'll just have to go out and buy the book yourself!