Some economic commentary

Club Troppo - November 18, 2008 - 8:16am

Peter Boettke makes a point about the role of tariff protection in the US leading the transition from the Great Crash to the Great Depression.

In the context of the Great Depression, one has to remember that after the stock market crash in 1929 market corrections were set in motion. Resources were reallocated, prices adjusted to the new realities. By June of 1930, the economy was recovering, when it was hit with the shock of a massive policy shift on tariffs. The Smoot-Hawley Tariff Act effectively raised the price on 20,000 imported goods by up to 50%. The consequence of this was the destruction of trade.

And an e-book of advice to the G20 leaders. Among the contributors, Dani Rodrik.

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