In awarding the Nobel Prize in economics, the Swedish committee wrote that Ben Bernanke’s 1983 paper, for which he was given the prize, showed that the Great Depression “became so deep and so protracted in large part because bank failures destroyed valuable banking relationships, and the resulting credit supply contraction left significant scars in the real economy. These were new insights …”
New insights? By 1983, this was standard economic history. So I went back and read the paper, “Non-Monetary Effects of the Financial Crisis in the Propagation of the Great Depression.”
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