British monetary austerity after 1920 produced an unhealthy quasi-equilibrium for a full decade

Evidence

As we know from chapter 6, in Britain monetary austerity hit starting in the spring of 1920, producing a slump that was followed by a decade of “doldrums.” In Pigou’s words: “Th e Doldrums was a period of relative stability and quasiequilibrium. But the equilibrium was not a healthy one, because it was characterised throughout by a very large amount of involuntary idleness” (Pigou 1947, 42). — Clara E. Mattei, The Capital Order, 1731

Categorization

• XREF: connects to: Swedish austerity in the 1920s produced the greatest slump in the nation’s history — Mark Blyth, Austerity: The History of a Dangerous…, 520; Gold-standard return caused depressions across Britain, Japan, and France — Mark Blyth, Austerity: The History of a Dangerous…, 557; Fed rate hikes in 1928 reversed capital flows and triggered austerity in Germany. — Mark Blyth, Austerity: The History of a Dangerous…, 502 (+14 more)