France 's Resistance Of The Great Depression Essay

1715 Words Apr 17th, 2015 null Page
France’s Resistance to the Great Depression
Unlike other leading industrial economic during 1920s, France resisted the onset of the Great Depression until 1931. By the beginning of 1927, France had avoided the road to total monetary disaster and national bankruptcy that other Continental countries were experiencing. Into 1930, France remained immune to the effect of the Great Depression; when most of the industrial world was bogging down, most of the parts of French industry was still operating at 1929 heights. Even in 1931, the downturn remained moderate compared other economies. While financial hysteria and extensive bankruptcy made money scarce elsewhere, capital poured into France to produce a unique situation of monetary plenty. The conventional view argues that the monetary policy was responsible for French economic growth after 1926. This paper argues that the fiscal policy was equally responsible for French economy 's resistance to the Depression.
France’s economy between 1921 and 1930 can be typically divided into three periods: inflation from 1921 through mid-1926, stabilization from Poincare’s return to power in July 1926 through the 1927 recession, renewed growth through the end of 1930. Following World War I, prices rose in France. During the inflation period, the confidence in the franc dropped so low on two separate occasions that it swayed on the edge of hyper-inflation. One of the occasions, which is also known as the “attack on the franc,” developed…

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