Richard Reisch, Exportförderung durch aktive Währungspolitik (1935)

This file is a compact 1935 monetary-policy monograph, expanded from two Prague lectures and ending with Ernst Ružička’s Valutabon form. Reisch addresses the export crisis after the breakdown of the gold standard. His thesis is that export promotion should not rely on general devaluation or merely defensive exchange control, but on an “active” policy that allocates domestically earned foreign exchange according to the economic use it finances.

Solche Wahrheiten sind: Der Export stellt nur die Aversseite des Außenhandels dar; seine untrennbare Reversseite ist der Import.

English translation: Such truths are: exports represent only the obverse of foreign trade; their inseparable reverse is imports.

Reisch’s opening move is to restore the reciprocity and multilateral character of trade. Export cannot be treated as a national gain detached from import; triangular and many-sided trade relations mean that bilateral balance requirements misconceive the structure of modern exchange. The work’s first sections therefore connect unemployment and industrial contraction to the destruction of international division of labor by autarky, quotas, clearing arrangements, and monetary mistrust.

Der Goldstandard war sozusagen die gemeinsame Sprache, das einigende Band im internationalen Handel.

English translation: The gold standard was, so to speak, the common language, the unifying bond in international trade.

This sentence is the hinge of the diagnosis. For Reisch, gold had supplied comparability, trust, and an automatic discipline over payments. Once abandoned, currencies ceased to be neutral auxiliaries of trade and became protected objects of national policy. “Managed currency” and exchange restrictions attempt to replace the lost automaticity, but they do so through increasingly complex regulation and mutual obstruction.

Die Devalvation stellt in Wahrheit ein Valuta-Dumping dar, dessen Kosten in verschiedener, höchst ungleichartiger und nicht immer leicht erkennbarer Weise von der gesamten Volkswirtschaft, die durch die Währungsdevalvation unstreitig verarmt, getragen werden muß.

English translation: Devaluation in truth constitutes a currency dumping, whose costs must be borne, in various, highly unequal, and not always easily discernible ways, by the entire national economy, which is indisputably impoverished by currency devaluation.

The critique of devaluation is central. Reisch grants that it may produce an initial export advantage, especially when used early and unexpectedly, but denies that it can yield durable prosperity. Competitors retaliate, imported inputs become dearer, domestic prices adjust, and the burden is shifted through wages, debts, contracts, and confidence. Clearing agreements and exchange controls are less aggressive, but for him they remain passive defenses: they ration payments abroad without creating a positive mechanism for export expansion.

Dieses Ergebnis ist nicht so sehr durch Änderung der Währungen als durch Änderung der Währungspolitik zu erreichen, die eine rationelle Verwendung der zur Verfügung stehenden „inländischen Auslandwährung“ sicherstellt.

English translation: This result is to be achieved not so much by changing currencies as by changing currency policy, which ensures a rational use of the available "domestic foreign exchange."

Here Reisch’s conceptual innovation appears: he separates the general value of the national currency from the management of foreign exchange earned inside the country. The latter becomes “inländische Auslandwährung,” a special mass to be priced and allocated differentially. Exporters should receive the full value of their valuta, and an added premium should arise from selling part of that valuta to importers of dispensable goods at higher prices, while vital imports receive preferential access.

Diese Außenhandelsbank erhält das ausschließliche Recht zur Ausstellung von Einfuhrbewilligungen und von mit diesen verbundenen Valutabons.

English translation: This foreign-trade bank obtains the exclusive right to issue import authorizations and the currency vouchers associated with them.

The institutional vehicle, drawn from Ružička, is an Außenhandelsbank beside the note bank. Export valuta delivered to it is represented by tradable Valutabons divided into A and B coupons: A for vital imports such as food and raw materials, B for other permitted imports. The B coupon’s higher market price both subsidizes exports and discourages unnecessary imports, functioning like a selective tariff without a general currency devaluation. Reisch also presents the plan as administrative simplification: import license and exchange allocation are fused in one tradable instrument, and broad categories replace discretionary individual permissions.

The later sections extend the design internationally. Reisch argues that foreign states should prefer this system to outright exchange denial, since valuta remains purchasable. Neighboring states can negotiate A-import lists, use reciprocal credit agreements between Außenhandelsbanken, and apply the system especially in the Danube region, where weak currencies and complementary economies make coordinated policy useful without abolishing monetary independence.

Das Endziel ist also die allgemeine Aufnahme der Barzahlungen durch Wiederherstellung des Goldstandards.

English translation: The ultimate goal is thus the general resumption of cash payments through the restoration of the gold standard.

The monograph is therefore transitional in spirit: it accepts planning, multiple exchange prices, and a special foreign-trade bank as emergency instruments, yet aims at restored monetary normality. Its relevance lies in showing an interwar attempt to reconcile liberal multilateral trade with active exchange management, shifting export promotion from blunt devaluation to differentiated foreign-exchange policy.