Great depression essays conclusion

Unemployment reached 25 percent in the worst days of 1932-33, but it was unevenly distributed. Job losses were less severe among women, workers in nondurable industries (such as food and clothing), services and sales workers, and those employed by the government. Unskilled inner city men had much higher unemployment rates. Age also played a factor: young people had a hard time getting their first job, and men over the age of 45, if they lost their job, would rarely find another one because employers had their choice of younger men. Millions were hired in the Great Depression, but men with weaker credentials were never hired, and fell into a long-term unemployment trap. The migration that brought millions of farmers and townspeople to the bigger cities in the 1920s suddenly reversed itself, as unemployment made the cities unattractive, and the network of kinfolk and more ample food supplies made it wise for many to go back. [20] City governments in 1930-31 tried to meet the depression by expanding public works projects, as president Herbert Hoover strongly encouraged. However, tax revenues were plunging, and the cities as well as private relief agencies were totally overwhelmed by 1931; no one was able to provide significant additional relief. People fell back on the cheapest possible relief, soup kitchens which provided free meals for anyone who showed up. [21] After 1933 new sales taxes and infusions of federal money helped relieve the fiscal distress of the cities, but the budgets did not fully recover until 1941.

Beginning initially in the 1930s, however, some students of the Great Depression have examined the unusually high level of process innovation in the 1920s and the lack of product innovation in the decade after 1925. The introduction of new production processes requires investment but may well cause firms to let some of their workforce go; by reducing prices, new processes may also reduce the amount consumers spend. The introduction of new products almost always requires investment and more employees; they also often increase the propensity of individuals to consume. The time path of technological innovation may thus explain much of the observed movements in consumption, investment, and employment during the interwar period. There may also be important interactions with the monetary variables discussed above: in particular, firms are especially dependent on bank finance in the early stages of developing a new product.

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From the point of view of today's mainstream schools of economic thought, government should strive to keep the interconnected macroeconomic aggregates money supply and/or aggregate demand on a stable growth path. When threatened by the forecast of a depression central banks should pour liquidity into the banking system and the government should cut taxes and accelerate spending in order to keep the nominal money stock and total nominal demand from collapsing. [29] At the beginning of the Great Depression most economists believed in Say's law and the self-equilibrating powers of the market and failed to explain the severity of the Depression. Outright leave-it-alone liquidationism was a position mainly held by the Austrian School. [30] The liquidationist position was that a depression is good medicine. The idea was the benefit of a depression was to liquidate failed investments and businesses that have been made obsolete by technological development in order to release factors of production (capital and labor) from unproductive uses so that these could be redeployed in other sectors of the technologically dynamic economy. They argued that even if self-adjustment of the economy took mass bankruptcies, then so be it. [30] An increasingly common view among economic historians is that the adherence of some Federal Reserve policymakers to the liquidationist thesis led to disastrous consequences. [31] Regarding the policies of President Hoover , economists like Barry Eichengreen and J. Bradford DeLong point out that President Hoover tried to keep the federal budget balanced until 1932, when he lost confidence in his Secretary of the Treasury Andrew Mellon and replaced him. [30] [31] [32] Despite liquidationist expectations, a large proportion of the capital stock was not redeployed but vanished during the first years of the Great Depression. According to a study by Olivier Blanchard and Lawrence Summers , the recession caused a drop of net capital accumulation to pre-1924 levels by 1933. [33] Milton Friedman called the leave-it-alone liquidationism "dangerous nonsense". [29] He wrote:

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Bernanke, Ben, “ On Milton Friedman's Ninetieth Birthday ," Remarks by Governor Ben S. Bernanke at the Conference to Honor Milton Friedman, University of Chicago, Chicago, IL, November 8, 2002.

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great depression essays conclusion

Great depression essays conclusion

From the point of view of today's mainstream schools of economic thought, government should strive to keep the interconnected macroeconomic aggregates money supply and/or aggregate demand on a stable growth path. When threatened by the forecast of a depression central banks should pour liquidity into the banking system and the government should cut taxes and accelerate spending in order to keep the nominal money stock and total nominal demand from collapsing. [29] At the beginning of the Great Depression most economists believed in Say's law and the self-equilibrating powers of the market and failed to explain the severity of the Depression. Outright leave-it-alone liquidationism was a position mainly held by the Austrian School. [30] The liquidationist position was that a depression is good medicine. The idea was the benefit of a depression was to liquidate failed investments and businesses that have been made obsolete by technological development in order to release factors of production (capital and labor) from unproductive uses so that these could be redeployed in other sectors of the technologically dynamic economy. They argued that even if self-adjustment of the economy took mass bankruptcies, then so be it. [30] An increasingly common view among economic historians is that the adherence of some Federal Reserve policymakers to the liquidationist thesis led to disastrous consequences. [31] Regarding the policies of President Hoover , economists like Barry Eichengreen and J. Bradford DeLong point out that President Hoover tried to keep the federal budget balanced until 1932, when he lost confidence in his Secretary of the Treasury Andrew Mellon and replaced him. [30] [31] [32] Despite liquidationist expectations, a large proportion of the capital stock was not redeployed but vanished during the first years of the Great Depression. According to a study by Olivier Blanchard and Lawrence Summers , the recession caused a drop of net capital accumulation to pre-1924 levels by 1933. [33] Milton Friedman called the leave-it-alone liquidationism "dangerous nonsense". [29] He wrote:

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great depression essays conclusion

Great depression essays conclusion

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great depression essays conclusion

Great depression essays conclusion

We encourage the educational use of the OWL. The Terms of Use explains the specific permissions granted.

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great depression essays conclusion
Great depression essays conclusion

From the point of view of today's mainstream schools of economic thought, government should strive to keep the interconnected macroeconomic aggregates money supply and/or aggregate demand on a stable growth path. When threatened by the forecast of a depression central banks should pour liquidity into the banking system and the government should cut taxes and accelerate spending in order to keep the nominal money stock and total nominal demand from collapsing. [29] At the beginning of the Great Depression most economists believed in Say's law and the self-equilibrating powers of the market and failed to explain the severity of the Depression. Outright leave-it-alone liquidationism was a position mainly held by the Austrian School. [30] The liquidationist position was that a depression is good medicine. The idea was the benefit of a depression was to liquidate failed investments and businesses that have been made obsolete by technological development in order to release factors of production (capital and labor) from unproductive uses so that these could be redeployed in other sectors of the technologically dynamic economy. They argued that even if self-adjustment of the economy took mass bankruptcies, then so be it. [30] An increasingly common view among economic historians is that the adherence of some Federal Reserve policymakers to the liquidationist thesis led to disastrous consequences. [31] Regarding the policies of President Hoover , economists like Barry Eichengreen and J. Bradford DeLong point out that President Hoover tried to keep the federal budget balanced until 1932, when he lost confidence in his Secretary of the Treasury Andrew Mellon and replaced him. [30] [31] [32] Despite liquidationist expectations, a large proportion of the capital stock was not redeployed but vanished during the first years of the Great Depression. According to a study by Olivier Blanchard and Lawrence Summers , the recession caused a drop of net capital accumulation to pre-1924 levels by 1933. [33] Milton Friedman called the leave-it-alone liquidationism "dangerous nonsense". [29] He wrote:

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Great depression essays conclusion

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great depression essays conclusion

Great depression essays conclusion

Beginning initially in the 1930s, however, some students of the Great Depression have examined the unusually high level of process innovation in the 1920s and the lack of product innovation in the decade after 1925. The introduction of new production processes requires investment but may well cause firms to let some of their workforce go; by reducing prices, new processes may also reduce the amount consumers spend. The introduction of new products almost always requires investment and more employees; they also often increase the propensity of individuals to consume. The time path of technological innovation may thus explain much of the observed movements in consumption, investment, and employment during the interwar period. There may also be important interactions with the monetary variables discussed above: in particular, firms are especially dependent on bank finance in the early stages of developing a new product.

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great depression essays conclusion

Great depression essays conclusion

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great depression essays conclusion

Great depression essays conclusion

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Free iPad & iPhone apps for the Great Depression

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