Despite its centrality in debates about the causes and consequences of the Great Depression, banking panics’ impact on the money supply during this period remains a subject of ongoing debate. Before 1936, the Fed's decentralized structure meant that panics impacted money creation regionally while monetary impulses impacted bank stability nationally. We use this structure and newly digitized data to construct monetary aggregates at the Federal Reserve district level and apply a novel identification strategy that allows us to isolate the panics’ impact on monetary aggregates. We find that panics reduced the money supply by 27%, or in other words, that panics caused most of the decline in the money supply from June 1929 to December 1932.

中文翻译：

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恐惧的蔓延：恐慌、金钱和大萧条

尽管银行恐慌在大萧条的原因和后果的争论中占据中心地位，但在此期间银行恐慌对货币供应的影响仍然是一个持续争论的话题。1936 年之前，美联储的分散结构意味着恐慌会影响区域性的货币创造，而货币冲动会影响全国性的银行稳定性。我们使用这种结构和新的数字化数据来构建美联储地区一级的货币总量，并应用一种新颖的识别策略，使我们能够隔离恐慌对货币总量的影响。我们发现，恐慌使货币供应量减少了27%，或者换句话说，从1929年6月到1932年12月，恐慌造成了货币供应量下降的大部分。