Flight-to-safety and the credit crunch: A new history of the banking crisis in France during the Great Depression

VoxEU.orgPrevious research has downplayed the role of banking panics and financial factors in the French Great Depression. This column uses a newly assembled dataset of balance sheets for more than 400 French banks from the interwar period to challenge this long-held idea. The empirical results show two dramatic waves of panic in 1930 and 1931, and point to a flight-to-safety mechanism. The findings illustrate how minor macroeconomic assumptions and extrapolations on monetary statistics can introduce large, persistent biases in historiography