ABSTRACT
This chapter analyzes interwar monetary fragmentation and the attempt to restore the gold standard, thus establishing the gold-exchange standard, which fell as a consequence of the 1929 crisis, so the interwar gold-exchange standard was not viable. It explores monetary fragmentation in the Baltic and North Seas region due to the creation of new independent states in Europe after First World War. The chapter begins by developing a theoretical framework applied to our two research objects: First, it outlines a complexity perspective on the interwar gold standard and a new gold standard today, and then a credit economy perspective on the interwar gold standard. It considers two attempts of restoring the gold standard: the pre-crisis historical interwar restoration and a post-crisis hypothetical restoration. The chapter attempts to find price stability by returning to a commodity-based payments system, the gold-exchange standard, after a period with floating exchange rates and high inflation, in some cases hyperinflation.
