Using a new international dataset of trade-weighed exchange rates, this paper highlights a neglected adjustment mechanism in the classical gold standard literature. Since gold-pegged countries traded extensively with economies operating more flexible monetary regimes and where parity change was a common adjustment device to systemic shocks, we show that such parity adjustments induced worldwide swings in nominal effective exchange rates. These translated into real exchange rate variations to which trade balances responded with an average elasticity of unity and in the direction of restoring external disequilibria. We conclude that some nominal exchange rate flexibility thus present in the pre-1914 system was instrumental to international payments adjustment.

Economic growth, International trade, Economic history, Growth econometrics, Globalization, F10, F13, N10, O11,

We derive monthly and quarterly series of UK GDP for the inter-war period from a set of monthly indicators that were constructed by The Economist at the time. The monthly information is complemented with data for quarterly industrial production, allowing us to employ mixed-frequency methods to produce monthly estimates of GDP and of industrial production. We proceed to illustrate how the new data compare with existing high frequency data and how they can be used to contribute to our understanding of the economic history of the UK in the inter-war period and to draw comparisons between recession profiles in the inter-war and the post-war period.

No abstract

Solomos Solomou presents a clear and systematic examination of the evidence for long-term patterns of economic growth. Using data on Britain, France, Germany, the USA and the world economy between 1850 and 1973 he refutes the existence of long (Kondratieff) waves in the course of economic development. Instead he presents persuasive evidence for a growth pattern characterised by shock-induced, long-term variations in growth at the level of the world economy. The findings show that national patterns of growth did not necessarily coincide with those of the world economy, but followed episodic long swing fluctuations of twenty to thirty years before the Second World War and trend-accelerated growth in the post-war period. The author provides new historical perspectives on the pre-1913 era, the inter-war years and the post-war boom.