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Hoover's Truce: Wage Rigidity in the Onset of the Great Depression

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  • Rose, Jonathan D.

Abstract

This article analyzes President Herbert Hoover's role in causing wage rigidity during the onset of the Great Depression, through two conferences in which he encouraged business leaders to maintain high wages. New data on the set of firms and trade associations attending these conferences provides evidence that Hoover's conferences delayed the cuts in hourly wages at a small number of large firms, although this result may have been due to characteristics of the particular industries the firms represented. In a cross-section of industries, there is no evidence that industry representation at the December conference affected the timing of wage cuts.

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  • Rose, Jonathan D., 2010. "Hoover's Truce: Wage Rigidity in the Onset of the Great Depression," The Journal of Economic History, Cambridge University Press, vol. 70(4), pages 843-870, December.
    • Handle: RePEc:cup:jechis:v:70:y:2010:i:04:p:843-870_00
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    Cited by:

    1. Jason Lennard, 2023. "Sticky wages and the Great Depression: evidence from the United Kingdom," European Review of Economic History, European Historical Economics Society, vol. 27(2), pages 196-222.
    2. Jordan Roulleau-Pasdeloup & Anastasia Zhutova, 2015. "Labor Market Policies and the "Missing Deflation" Puzzle: Lessons from Hoover Policies during the U.S Great Depression," Cahiers de Recherches Economiques du Département d'économie 15.05, Université de Lausanne, Faculté des HEC, Département d’économie.
    3. Timothy J. Hatton & Mark Thomas, 2012. "Labour Markets in Recession and Recovery: The UK and the USA in the 1920s and 1930s," CEH Discussion Papers 001, Centre for Economic History, Research School of Economics, Australian National University.
    4. Jordan Roulleau‐Pasdeloup & Anastasia Zhutova, 2022. "Labor Market Policies in a Deep Recession: Lessons from Hoover's Policies during the U.S. Great Depression," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 54(1), pages 247-283, February.
    5. Price V. Fishback & Andrew J. Seltzer, 2021. "The Rise of American Minimum Wages, 1912–1968," Journal of Economic Perspectives, American Economic Association, vol. 35(1), pages 73-96, Winter.
    6. Chicu, Mark & Vickers, Chris & Ziebarth, Nicolas L., 2013. "Cementing the case for collusion under the National Recovery Administration," Explorations in Economic History, Elsevier, vol. 50(4), pages 487-507.
    7. Harold L. Cole & Lee E. Ohanian, 2013. "The Impact of Cartelization, Money, and Productivity Shocks on the International Great Depression," NBER Working Papers 18823, National Bureau of Economic Research, Inc.
    8. Price V. Fishback, 2020. "Rule of Law in Labor Relations, 1898-1940," NBER Working Papers 27614, National Bureau of Economic Research, Inc.
    9. Petrosky-Nadeau, Nicolas & Zhang, Lu, 2021. "Unemployment crises," Journal of Monetary Economics, Elsevier, vol. 117(C), pages 335-353.
    10. Price V. Fishback & John Joseph Wallis, 2012. "What Was New About the New Deal?," NBER Working Papers 18271, National Bureau of Economic Research, Inc.
    11. Patrick Newman, 2016. "The depression of 1920–1921: a credit induced boom and a market based recovery?," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 29(4), pages 387-414, December.
    12. Todd Neumann & Jason Taylor & Price Fishback, 2013. "Fluctuations in Weekly Hours and Total Hours Worked Over the Past 90 Years and the Importance of Changes in Federal Policy Toward Job Sharing," NBER Working Papers 18816, National Bureau of Economic Research, Inc.
    13. Holt, Andrew Chase, 2024. "Monopsony power in the United States: Evidence from the great depression," Explorations in Economic History, Elsevier, vol. 92(C).
    14. Joshua K. Hausman & Johannes F. Wieland, 2015. "Overcoming the Lost Decades? Abenomics after Three Years," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 46(2 (Fall)), pages 385-431.
    15. Todd C. Neumann & Jason E. Taylor & Price Fishback, 2013. "Comparisons of Weekly Hours over the Past Century and the Importance of Work-Sharing Policies in the 1930s," American Economic Review, American Economic Association, vol. 103(3), pages 105-110, May.
    16. Ji, Yangyang & Xiao, Wei, 2019. "Was the New Deal expansionary?," Economics Letters, Elsevier, vol. 184(C).

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