<P> According to later analysis, the earliness with which a country left the gold standard reliably predicted its economic recovery . For example, Great Britain and Scandinavia, which left the gold standard in 1931, recovered much earlier than France and Belgium, which remained on gold much longer . Countries such as China, which had a silver standard, almost avoided the depression entirely . The connection between leaving the gold standard as a strong predictor of that country's severity of its depression and the length of time of its recovery has been shown to be consistent for dozens of countries, including developing countries . This partly explains why the experience and length of the depression differed between national economies . </P> <P> Many economists have argued that the sharp decline in international trade after 1930 helped to worsen the depression, especially for countries significantly dependent on foreign trade . In a 1995 survey of American economic historians, two - thirds agreed that the Smoot--Hawley Tariff Act at least worsened the Great Depression . Most historians and economists partly blame the American Smoot--Hawley Tariff Act (enacted June 17, 1930) for worsening the depression by seriously reducing international trade and causing retaliatory tariffs in other countries . While foreign trade was a small part of overall economic activity in the U.S. and was concentrated in a few businesses like farming, it was a much larger factor in many other countries . The average ad valorem rate of duties on dutiable imports for 1921--25 was 25.9% but under the new tariff it jumped to 50% during 1931--35 . In dollar terms, American exports declined over the next four (4) years from about $5.2 billion in 1929 to $1.7 billion in 1933; so, not only did the physical volume of exports fall, but also the prices fell by about 1 / 3 as written . Hardest hit were farm commodities such as wheat, cotton, tobacco, and lumber . </P> <P> Governments around the world took various steps into spending less money on foreign goods such as: "imposing tariffs, import quotas, and exchange controls". These restrictions formed a lot of tension between trade nations, causing a major deduction during the depression . Not all countries enforced the same measures of protectionism . Some countries raised tariffs drastically and enforced severe restrictions on foreign exchange transactions, while other countries condensed "trade and exchange restrictions only marginally": </P> <Ul> <Li> "Countries that remained on the gold standard, keeping currencies fixed, were more likely to restrict foreign trade ." These countries "resorted to protectionist policies to strengthen the balance of payments and limit gold losses ." They hoped that these restrictions and depletions would hold the economic decline . </Li> <Li> Countries that abandoned the gold standard, allowed their currencies to depreciate which caused their balance of payments to strengthen . It also freed up monetary policy so that central banks could lower interest rates and act as lenders of last resort . They possessed the best policy instruments to fight the Depression and did not need protectionism . </Li> <Li> "The length and depth of a country's economic downturn and the timing and vigor of its recovery is related to how long it remained on the gold standard . Countries abandoning the gold standard relatively early experienced relatively mild recessions and early recoveries . In contrast, countries remaining on the gold standard experienced prolonged slumps ." </Li> </Ul>

Describe the two factors that played a major role in the start of the great depression