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13 - Exchange Rates, Tariffs and Prices in 1930s Britain

Published online by Cambridge University Press:  14 December 2023

By
Jagjit S. Chadha ,
Jason Lennard ,
Solomos Solomou  and
Ryland Thomas
Edited by
Patricia Clavin ,
Giancarlo Corsetti ,
Maurice Obstfeld  and
Adam Tooze
Patricia Clavin
Affiliation:
University of Oxford
Giancarlo Corsetti
Affiliation:
University of Cambridge
Maurice Obstfeld
Affiliation:
Peterson Institute for International Economics, Washington DC
Adam Tooze
Affiliation:
Columbia University, New York
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Summary

This chapter investigates the degree of pass-through from import prices and tariffs to wholesale prices in interwar Britain using a new high-frequency micro data set. The main results are: (i) Pass-through from import prices and tariffs to wholesale prices was economically and statistically significant. (ii) Despite devaluation, import prices exacerbated deflation in the early 1930s because of the global slump in export prices. (iii) Rising protection, however, was a mild stimulus to prices during the shift to inflation.

Keywords

Exchange ratesinterwarpass-throughpricestariffsUnited Kingdom
Type
Chapter
Information
Keynes's Economic Consequences of the Peace after 100 Years
Polemics and Policy
 , pp. 325 - 363
Publisher: Cambridge University Press
Print publication year: 2024

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