ROLE OF THE INTERNATIONAL GOLD STANDARD IN PROPAGATING THE GREAT DEPRESSION

I do not claim in this paper that the international gold standard was a principal cause of the Great Depression. Instead, I explore the events that allowed the world to slip deeper into depression despite the gold standard. The volatility of international short-term capital flows surely contributed greatly to the Depression. I argue that this volatility was exacerbated—rather than ameliorated—by the international gold standard. The reason is that despite governments' legal assurances that they are committed to a gold standard, speculators never perceive the terms of gold parity as immutable. This statement holds with increasing force when one observes the precarious status of government debts and international finance during the 1920s. This reality renders a gold standard vulnerable to precisely the type of volatility in international capital markets that made the 1931 downturn more severe.     

Japanese Companies in Germany: A Case Study in Cross-Cultural Management

From a series of qualitative interviews with Japanese managers and German managers and workers in thirty-one Japanese-owned companies in the Düsseldorf region of western Germany, this article discusses differences in cultural patterns and organizational styles between the German and Japanese employees and the problems these pose for communication, cooperation, and morale. First, we deal with cultural contrasts: language issues, interpersonal styles (personability and politeness), and norms regarding the taking of responsibility. Second, we examine the impact on cross-nationality relations of established organizational practice: for example, German specialism vs. Japanese generalism; direct and vertical vs. indirect and incremental decision making. We also discuss efforts by these firms to find compromise systems that would meet the needs and interests of both sides. The third focus is the reactions of Japanese companies in North Rhine-Westphalia to German unions, works councils, and codetermination regulations. In the labor view, Japanese firms overall do no better or worse than comparable German firms.     

NATIONAL SECURITY AND INDUSTRIAL POLICY: THE NEED FOR A PUBLIC CHOICE PERSPECTIVE

This paper argues that the issues raised by the industrial policy debate are as much political as they are economic. There is every reason to believe that, without substantial reform of political institutions, efforts to administer a rational new industrial policy would soon degenerate into the type of inconsistent morass of special-interest-generated policies which industrial policy advocates rightfully criticize as our de facto set of industrial policies.
This important political dimension has been overlooked by many industrial policy advocates. An important exception is Robert Reich, who has proposed a new centralized industrial policy agency in hopes that the battle of conflicting interests would promote greater aggregate efficiency. We argue that on theoretical grounds, however, such centralization might either increase or decrease efficiency. The competition of the military services under the Defense Department gives us a close analogue for study. Unfortunately, however, our review of efficiency in defense policy suggests that this would be a very poor model on which to base a broader industrial policy. To promote substantial increases in defense and industrial policy efficiency appears to require that much more fundamental institutional reforms be considered.