Wi No Return To The Gold Standard For The British Economy?

I've heard it suggested Churchill's decision (as Chancellor in 1925) to return to the Gold Standard was a major contributary factor to the Great Depression, at least in the UK.

What if however, he decided to keep the economy off gold? The return to the Gold Standard was a popular one with most of parliament, so could he have survived as Chancellor had he made a different decision?

More importantly, what are the more long-term affects of this, both for Britain and the rest of the world?
 
From what I understand Churchill was actually skeptical about returning to the Gold Standard but there was so much pressure to restore it from Parliament, the Bank of England and the Treasury. So he could not have avoided it if he was really dead set against it.

As to the consequences, sadly there is typically little repsonse to economic themed threads such as this because the issues are so complicated that unless you have a very good grasp of economics its difficult to speak authoritatively :( But from what I've seen there is a consensus that not resuming the GS would have made the Depression less severe.
 
British industry had been in trouble for a while even before the First World War, which only exacerbated those problems. Staying off the gold standard would help alleviate some of the difficulties, provided that the Exchequer didn't allow the the money supply to shrink during the crisis. But without broader policy changes, the Great Depression will still be devastating, and the 1926 general strike will still probably occur, with all the disastrous reactionary fallout that the government promulgated that only further depressed wages in the aftermath.
 

BlondieBC

Banned
Broadly speaking, the money supply increase 3:1 in the UK during the war when one counts paper debt and credit (i.e 3:1 inflation). Wages had only doubled. So if the UK abandoned gold, or more likely repegs at a lower rate, the UK will have to admit that the standard of living plummeted during the war, and the decline was a permanent decline. So likely there is still a lot of labor unrest, but the export industries will improve a lot. Improvement in exports will be partially countered by higher import prices. Exporters such as manufactures and shipyards will do very well. Food prices will soar.

Not going back on the gold standard would have been better than the path the UK chose, and I think the best course would have been a 5 to 1 devaluation of the pound. Or one pound = one USD.
 
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