Leaving the gold standard and sharing adjustment costs ended Swedish austerity.

Evidence

The surprising thing was that it worked. Farmers, business, and labor all came together with the state in an encompassing coalition that allowed the costs and benefits of adjustments to be equally shared. Swedish austerity ended when it came off gold and actively changed its mind about how to run an economy. When Germany, Sweden’s major trading partner, did the same and began to grow rapidly after adopting a very different kind of expansionary policy after 1933, external demand really picked up and austerity in Sweden disappeared for the next fifty years. — Mark Blyth, Austerity, 524

Categorization

• XREF: Directly relevant to Mattei’s austerity literature and the gold-standard exit stories in the broader post-Keynesian recovery literature. — connects to: The euro institutionalized a gold standard, removing devaluation as a national adjustment tool. — Mark Blyth, Austerity: The History of a Dangerous…, 216; British austerity culminated in forced departure from the gold standard in 1931 — Mark Blyth, Austerity: The History of a Dangerous…, 517; The gold standard naturalized austerity by removing it from political dispute — Clara E. Mattei, The Capital Order: How Economists…, 1302 (+2 more)
• ADDENDUM: The encompassing coalition and shared adjustment costs echo the sacrifice framing in ‘On Sacrifice’ — here sacrifice is shared broadly rather than concentrated, which inverts that article’s thesis.

Broader Connections

• The euro institutionalized a gold standard, removing devaluation as a national adjustment tool. #expands (0.80) — Mark Blyth, Austerity, 216
• British austerity culminated in forced departure from the gold standard in 1931 #exemplifies (0.80) — Mark Blyth, Austerity, 517
• The gold standard naturalized austerity by removing it from political dispute #corroborates (0.80) — Clara E. Mattei, The Capital Order, 1302
• Austerity has failed systematically whenever governments face gold-standard-style constraints #corroborates (0.75) — Mark Blyth, Austerity, 504
• Gold’s fixed supply gave the gold standard a built-in contractionary bias toward deflation #expands (0.75) — Mark Blyth, Austerity, 493