How Did The Great Depression Affect The Economy
INTRODUCTION
The Great Depression began in the 1930’s and lasted till about 1939, approximately 10 years. During this time the world went through a disastrous economic disintegration. There was a 25% decrease in the level of production, unemployment rates flew up in America, Britain, and Germany, and the liberal market economic system lost its validity.
Real Gross Domestic Product descended approximately 30%, and real per capita disposable income plunged another 40%. About 12 million people became jobless, and almost 85, 000 businesses around the globe fizzled up, and thousands of people became homeless.
By 1993 the economy started to regain itself, but there was a great reduction in business activity. In 1937 there was a
decline, which accelerated the unemployment rate to 19% the next year.
There have been many a lot of debates on what cause The Great Depression, a lot of theories have been brought forward, but no reason has been singled out as the true cause of The Great Depression. Some economist blamed The Great Depression on protectionist trade policies, some have referred to it as an impending lack of success of the capitalism, and some blamed it on the “exuberance” of the 1920’s: exuberant production, commodities, building, and financial conjecture.
OBJECTIVES OF THE STUDY
1. To outline the events and actions that led to The Great Depression.
2. To explain the depression using competing theories.
3. To explore the relationship between The Great Depression and Macroeconomic theories.
4. To see the impact of it had on various countries.
The Great Depression began in the 1930’s and lasted till about 1939, approximately 10 years. During this time the world went through a disastrous economic disintegration. There was a 25% decrease in the level of production, unemployment rates flew up in America, Britain, and Germany, and the liberal market economic system lost its validity.
Real Gross Domestic Product descended approximately 30%, and real per capita disposable income plunged another 40%. About 12 million people became jobless, and almost 85, 000 businesses around the globe fizzled up, and thousands of people became homeless.
By 1993 the economy started to regain itself, but there was a great reduction in business activity. In 1937 there was a
decline, which accelerated the unemployment rate to 19% the next year.
There have been many a lot of debates on what cause The Great Depression, a lot of theories have been brought forward, but no reason has been singled out as the true cause of The Great Depression. Some economist blamed The Great Depression on protectionist trade policies, some have referred to it as an impending lack of success of the capitalism, and some blamed it on the “exuberance” of the 1920’s: exuberant production, commodities, building, and financial conjecture.
OBJECTIVES OF THE STUDY
1. To outline the events and actions that led to The Great Depression.
2. To explain the depression using competing theories.
3. To explore the relationship between The Great Depression and Macroeconomic theories.
4. To see the impact of it had on various countries.