Robbins blamed the 1930s depression on social insurance and managed money.

Evidence

Set against this background, Robbins’s Great Depression of 1934 is a doctrinaire tract lacking engagement with contemporary economic problems. This disconnect was noted at the time; the reviewer in the Economic Journal opened by noting that the study was made “from the standpoint of the analytical neo-individualism which has been developing in recent years at the London School of Economics” and further suggested that Robbins’s objective was to vindicate “an elaborate and essentially abstract theory of the conditions of equilibrium.” Robbins’s general argument was that prosperity would return only if the market were permitted to work without hindrance. He argued that central bankers seeking to promote reflation simply created greater fluctuations; and that the creation of a social insurance system had removed any incentive trade unions might have had to protect their members by agreeing to reductions in wages. Hence Robbins’s policy argument was that central bankers should not seek to manage financial markets and that universal social insurance was a bad idea. The longest chapter in the book outlines a blueprint for recovery, which emphasizes the restoration of business confidence through the stabilization of international exchange, hence the restoration of the Gold Standard as the route to renewed growth and prosperity and the consequent reduction of unemployment. — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 398

Categorization

• XREF: The Depression as punishment for state intervention prefigures the later austerity politics the reader studies; Robbins pairs with Hayek via von Mises influence. — connects to: Robbins blamed state interventions rather than market failure for the Depression — Angus Burgin, The Great Persuasion: Reinventing Free…, 73; Robbins recanted his earlier Great Depression extremism — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 414; Early LSE market advocates blamed government-stimulated business cycles for the depression. — Angus Burgin, The Great Persuasion: Reinventing Free…, 45
• DEFINE: This concretizes what ‘analytical neo-individualism’ meant at the LSE in 1934 — a market-equilibrium framework insulated from empirical engagement.
• corroborated: 2 independent passages support this claim — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 398

Broader Connections

• Robbins recanted his earlier Great Depression extremism #responds-to (0.72) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 414