THE 1932 foreign trade figures of the leading commercial countries afford an opportunity for speculation with regard to the effects of currency instability upon imports and exports. The trade of three countries with stable currencies -- France, Germany and the United States -- may be compared with that of two countries with depreciated currencies -- Great Britain and Canada. In theory, currency depreciation tends to stimulate exports and to check imports. Investigation shows that the exports of all the countries mentioned were less in 1932 than in 1931, but that the decline was substantially greater in the stable-money countries. The decrease in the value of exports in 1932 from the previous year was 35 percent in France, 40 percent in Germany and 33 percent in the United States. In Great Britain and Canada, on the other hand, the decreases were respectively 7 and 19 percent.
This would seem to indicate that the cheap money of Great Britain and Canada, while not causing an absolute increase in exports, may have been instrumental in producing a smaller decline than was experienced by stable-money countries. On the other hand, if the export trade of these five countries in 1932 is compared with that of the pre-depression year 1929, the relative changes shown by the two groups are not so striking. From 1929 to 1932 the value of exports decreased 60 percent in France, 58 percent in Germany and 65 percent in the United States, while for Great Britain and Canada the decreases were respectively 50 and 59 percent.
The decline in the case of Germany, France and Canada shows remarkable uniformity. As British trade was lagging behind that of these other countries in 1929, a relatively smaller decline might be expected. For a contrary reason, a greater decline might be expected in the United States, inasmuch as its export trade in the pre-depression years had been stimulated by heavy loans to foreign countries.
It is impossible to obtain conclusive evidence from trade statistics regarding the effects of the depreciation of foreign currencies on imports and exports. The United States Tariff Commission, in response
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