Why do some banks fail in financial crises while others survive? This article answers this question by analysing the effect of the Dutch financial crisis of the 1920s on 142 banks, of which 33 failed. We find that choices of balance sheet composition and product market strategy made in the...

The interwar gold standard is long thought to have prevented central bankers from running an independent monetary policy, forcing governments to leave this fixed exchange rate system in order to take control over domestic policy. But our study of the day-to-day management of monetary policy in...

Under what conditions can policymakers make demonstrably poor policy choices? By providing a new account of monetary policy management in the Netherlands during the interwar gold standard, we show how policymakers can fail to escape their long-held beliefs and refuse to consider available policy...