DP15812 Gold and South Africa's Great Depression

Author(s): Barry Eichengreen
Publication Date: February 2021
Programme Areas: Economic History
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=15812

South Africa was one of the fastest growing economies of the 1930s. This paper seeks to identify the roots of this macroeconomic outperformance and reconcile it with the country's delayed departure from the gold standard, such departure having typically been the event inaugurating recovery from the slump. It emphasizes South Africa's dependence on gold production, which gave the economy an additional boost from currency depreciation, over and above that felt in other countries, when depreciation finally took place. This highlights the paradox of South African policy makers' resistance to currency depreciation, as epitomized by the report of the Select Committee on the Gold Standard in 1932.