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Consumption in the Great Depression

Thomas Mayer

Journal of Political Economy 1978

This paper criticizes Temin's hypothesis that the Great Depression was caused by an exogenous decline in consumption in 1930. Using Temin's own consumption function, as well as two other ones on the levels of the data, there is little support for Temin's hypothesis. First difference regressions support Temin's hypothesis if one uses a dummy variable for 1930. But if one looks instead at the residuals from the regressions, then the data provide only very limited support for it.

DOI
10.1086/260652
Volume
86 (1)
Pages
139-145
Language
en
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