The Great Depression – Retro Part 1

Abstract

The study was written because the economic crisis of 2008 had been compared by many, including renowned economic experts, with the one in 1929– 1933. Dealing with the latest literature on the sub ject, I drew the following surprising lessons for myself. Firstly, the literature available for the Hungarian professional public is rather poor com pared to what can be found out from leading for eign research on the subject that combine econom ic theory and history. Secondly, the thesis that the lesson has been drawn from the historical experi ence of the Great Depression is only partly true. Only one of the reasons for this incompleteness is that ‘retrograde’ institutional changes took place. The other reason is that there are really serious question marks, which can be considered epistemo logical, concerning the way the Great Depression evolved and ended. In other words, it is sensible to treat our knowledge of the events of that time with proper humility, considering its limits; it does not hurt to be aware of the puzzles that still exist. One should be restrained when harping on the question ‘Can it happen again?’. I believe that one can bet ter understand this lesson, if I do not tell the new, linear story that can be reconstructed according to the new framework of attitude, but I present the difference between the earlier and newer approach es in connection with individual problems.