Great Depression Warning: You are not logged in. Your IP address will be publicly visible if you make any edits. If you log in or create an account, your edits will be attributed to your username, along with other benefits.Anti-spam check. Do not fill this in! {{Short description|Worldwide economic depression (1929–1939)}} {{About|the severe worldwide economic downturn in the 1930s|other uses|The Great Depression (disambiguation)}} {{pp-vandalism|small=yes}} {{Use dmy dates|date=November 2023}}{{Use American English|date=November 2023}} [[File:Unemployed men queued outside a depression soup kitchen opened in Chicago by Al Capone, 02-1931 - NARA - 541927.jpg|thumb|[[Unemployment|Unemployed]] [[Man|men]] lined up outside a [[soup kitchen]] in [[Chicago]].]] The '''Great Depression''' (1929{{endash}}1939) was a severe global economic downturn that affected many countries across the world<!-- Per [[MOS:REDUNDANCY]] try not repeating words, like "The Great Depression was a period of depression". -->. It became evident after a sharp decline in [[stock]] prices in the [[United States]], leading to a period of [[economic depression]].<ref>John A. Garraty, ''The Great Depression'' (1986)</ref> The [[Financial contagion|economic contagion]] began around September 1929 and led to the [[Wall Street Crash of 1929|Wall Street stock market crash]] of 24 October (Black Thursday). This crisis marked the start of a prolonged period of economic hardship characterized by high unemployment rates and widespread business failures.<ref name="ReferenceA">{{Cite news |last=Duhigg |first=Charles |date=March 23, 2008 |title=Depression, You Say? Check Those Safety Nets |language=en-US |work=The New York Times |url=https://www.nytimes.com/2008/03/23/weekinreview/23duhigg.html |url-status=live |access-date=December 25, 2021 |archive-url=https://web.archive.org/web/20210301125622/http://www.nytimes.com/2008/03/23/weekinreview/23duhigg.html |archive-date=March 1, 2021 |issn=0362-4331}}</ref> Between 1929 and 1932, worldwide [[Gross domestic product|gross domestic product (GDP)]] fell by an estimated 15%. By comparison, worldwide GDP fell by less than 1% from 2008 to 2009 during the [[Great Recession]].<ref>Roger Lowenstein, "History Repeating", [https://www.wsj.com/articles/book-review-hall-of-mirrors-by-barry-eichengreen-1421192283 ''Wall Street Journal'' Jan 14, 2015] {{Webarchive|url=https://web.archive.org/web/20210506080932/https://www.wsj.com/articles/book-review-hall-of-mirrors-by-barry-eichengreen-1421192283|date=May 6, 2021}}</ref> Some economies started to recover by the mid-1930s. However, in many countries,{{specify|date=May 2023}} the negative effects of the Great Depression lasted until the beginning of [[World War II]]. Devastating effects were seen in both rich and poor countries with falling [[personal income]], prices, tax revenues, and profits. International trade fell by more than 50%, unemployment in the U.S. rose to 23% and in some countries rose as high as 33%.<ref name="Frank_Bernanke">{{cite book |last1=Frank |first1=Robert H. |title=Principles of Macroeconomics |last2=Bernanke |first2=Ben S. |publisher=McGraw-Hill/Irwin |year=2007 |isbn=978-0-07-319397-7 |edition=3rd |location=Boston |page=98}}</ref> [[Cities in the Great Depression|Cities around the world were hit]] hard, especially those dependent on [[heavy industry]]. Construction was virtually halted in many countries. Farming communities and rural areas suffered as crop prices fell by about 60%.<ref name="USBLS">{{cite web |title=Commodity Data |url=https://www.bls.gov/data/ |url-status=live |archive-url=https://web.archive.org/web/20190603140110/https://www.bls.gov/data/ |archive-date=June 3, 2019 |access-date=November 30, 2008 |publisher=U.S. Bureau of Labor Statistics}}</ref><ref>{{cite book |author=Cochrane, Willard W. |author-link=Willard Cochrane |year=1958 |title=Farm Prices, Myth and Reality |page=15}}</ref><ref>{{cite journal |title=World Economic Survey 1932–33 |journal=[[League of Nations]] |page=43}}</ref> Faced with plummeting demand and few job alternatives, areas dependent on [[Primary sector of the economy|primary sector industries]] suffered the most.<ref>Mitchell, ''Depression Decade''</ref> Economic historians usually consider the catalyst of the Great Depression to be the devastating Wall Street Crash. However, some dispute this, seeing the crash less as a cause of the Depression and more a symptom of the rising nervousness of investors partly due to gradual price declines caused by falling sales of consumer goods (as a result of overproduction because of new production techniques, falling exports and income inequality, among other factors) that had already been underway as part of a gradual depression.<ref name="Frank_Bernanke" /><ref name="Britannica">[https://www.britannica.com/EBchecked/topic/243118/Great-Depression "Great Depression"] {{Webarchive|url=https://web.archive.org/web/20150509121741/https://www.britannica.com/EBchecked/topic/243118/Great-Depression|date=May 9, 2015}}, ''Encyclopædia Britannica''</ref> == Overview == {{Multiple image | image1 = US Unemployment from 1910-1960.svg | image2 = 1929 wall street crash graph.svg | caption1 = The unemployment rate in the U.S. during 1910–60, with the years of the Great Depression (1929–39) highlighted | caption2 = The [[Dow Jones Industrial Average]], 1928–1930 | align = left }} After the [[Wall Street Crash of 1929]], where the [[Dow Jones Industrial Average]] dropped from 381 to 198 over the course of two months, optimism persisted for some time. The stock market rose in early 1930, with the Dow returning to 294 (pre-depression levels) in April 1930, before steadily declining for years, to a low of 41 in 1932.<ref>{{cite web |title=1998/99 Prognosis Based Upon 1929 Market Autopsy |url=https://www.gold-eagle.com/editorials_98/vronsky060698.html |url-status=dead |archive-url=https://web.archive.org/web/20080517075810/https://www.gold-eagle.com/editorials_98/vronsky060698.html |archive-date=May 17, 2008 |access-date=May 22, 2008 |publisher=Gold Eagle}}</ref> At the beginning, governments and businesses spent more in the first half of 1930 than in the corresponding period of the previous year. On the other hand, consumers, many of whom suffered severe losses in the stock market the previous year, cut expenditures by 10%. In addition, beginning in the mid-1930s, a [[Dust Bowl|severe drought]] ravaged the agricultural heartland of the U.S.<ref name="drought">{{cite web |title=Drought: A Paleo Perspective – 20th Century Drought |url=https://www.ncdc.noaa.gov/paleo/drought/drght_history.html |url-status=live |archive-url=https://web.archive.org/web/20090330022940/http://www.ncdc.noaa.gov/paleo/drought/drght_history.html |archive-date=March 30, 2009 |access-date=April 5, 2009 |publisher=[[National Climatic Data Center]]}}</ref> Interest rates dropped to low levels by mid-1930, but expected [[deflation]] and the continuing reluctance of people to borrow meant that consumer spending and investment remained low.<ref>{{Cite journal |last=Hamilton |first=James |year=1987 |title=Monetary Factors in the Great Depression |journal=Journal of Monetary Economics |volume=19 |issue=2 |pages=145–69 |doi=10.1016/0304-3932(87)90045-6}}</ref> By May 1930, automobile sales declined to below the levels of 1928. Prices, in general, began to decline, although wages held steady in 1930. Then a [[deflationary spiral]] started in 1931. Farmers faced a worse outlook; declining crop prices and a Great Plains drought crippled their economic outlook. At its peak, the Great Depression saw nearly 10% of all Great Plains farms change hands despite federal assistance.<ref>{{Cite web |title=The Great Depression |url=https://drought.unl.edu/DroughtBasics/DustBowl/TheGreatDepression.aspx |url-status=live |archive-url=https://web.archive.org/web/20180329184059/http://drought.unl.edu/DroughtBasics/DustBowl/TheGreatDepression.aspx |archive-date=March 29, 2018 |access-date=March 29, 2018 |website=drought.unl.edu |language=en-US}}</ref> The decline in the [[Economy of the United States|U.S. economy]] was the factor that pulled down most other countries at first; then, internal weaknesses or strengths in each country made conditions worse or better.{{Citation needed|date=May 2021}} Frantic attempts by individual countries to shore up their economies through [[protectionism|protectionist]] policies – such as the 1930 U.S. [[Smoot–Hawley Tariff Act]] and retaliatory tariffs in other countries – exacerbated the collapse in global trade, contributing to the depression.<ref>{{cite book |title=Historic Events for Students: The Great Depression |date=July 2002 |publisher=Gale |isbn=978-0-7876-5701-7 |editor-last1=Richard |editor-first1=Clay Hanes |edition=Volume I}}</ref> By 1933, the economic decline pushed world trade to one third of its level compared to four years earlier.<ref>{{Cite book |last=Tignor |first= Robert L. |title=Worlds together, worlds apart: a history of the world from the beginnings of humankind to the present |date=October 28, 2013 |isbn=978-0-393-92207-3 |edition=Fourth |location=New York |oclc=854609153 |publisher=W. W. Norton }}</ref> == Economic indicators == {| class="wikitable" style="width: 50%;text-align: right;" |+ Change in economic indicators 1929–1932<ref>[[Jerome Blum]], [[Rondo Cameron]], [[Thomas G. Barnes]], ''The European world: a history'' (2nd ed 1970) 885 pp.</ref> |- ! scope="col" style="width:36%;"| ! scope="col" style="width:16%; text-align:center;"| United States ! scope="col" style="width:16%; text-align:center;"| United Kingdom ! scope="col" style="width:16%; text-align:center;"| France ! scope="col" style="width:16%; text-align:center;"| Germany |- | style="text-align: left;"| Industrial production | −46% | −23% | −24% | −41% |- | style="text-align: left;"| Wholesale prices | −32% | −33% | −34% | −29% |- | style="text-align: left;"| Foreign trade | −70% | −60% | −54% | −61% |- | style="text-align: left;"| Unemployment | +607% | +129% | +214% | +232% |} == Course == [[File:Crowd outside nyse.jpg|thumb|Crowd gathering at the intersection of [[Wall Street]] and Broad Street after the [[Wall Street Crash of 1929|1929 crash]]]] === Origins === Because the Great Depression began in the United States and then spread around the world, the origins of the Great Depression are examined in the context of the United States economy. In the aftermath of [[World War I]], the [[Roaring Twenties]] had brought considerable wealth to the United States and Western Europe.<ref name="Soule-1947">George H. Soule, ''Prosperity Decade: From War to Depression: 1917–1929'' (1947)</ref> The year 1929 dawned with considerable economic progress in the American economy. A small stock crash occurred on 25 March 1929, but the crash was stabilized. Despite signs of economic trouble, the market continued to improve through September. Stock prices began to slump in September, and were volatile at the end of September.<ref name="pbsstock2">{{cite web |title=Timeline: A selected Wall Street chronology |url=https://www.pbs.org/wgbh/amex/crash/timeline/timeline2.html |url-status=dead |archive-url=https://web.archive.org/web/20080923040829/http://www.pbs.org/wgbh/amex/crash/timeline/timeline2.html |archive-date=September 23, 2008 |access-date=September 30, 2008 |publisher=[[Public Broadcasting Service|PBS]]}}</ref> A large sell-off of stocks began in mid-October. Finally, on 24 October, [[Wall Street Crash of 1929|Black Thursday]], the American stock market crashed 11% at the opening bell. Actions to stabilize the market failed, and on 28 October, Black Monday, the market crashed another 12%. The panic peaked the next day on Black Tuesday, when the market saw another 11% drop.<ref name=":02">{{Cite news |last1=Post |first1=Special to Financial |date=October 24, 2011 |title=The Great Crash of 1929, some key dates |language=en-CA |website=Financial Post |url=https://financialpost.com/personal-finance/the-great-crash-of-1929-some-key-dates |access-date=July 22, 2020}}</ref><ref name=":4">{{cite web |author=<!--ET Bureau--> |date=October 22, 2017 |title=Market crash of 1929: Some facts of the economic downturn |url=https://economictimes.indiatimes.com/industry/miscellaneous/market-crash-of-1929-some-facts-of-the-economic-downturn/articleshow/61166918.cms |access-date=February 16, 2019 |work=Economic Times |publisher=Times Inernet}}</ref> Thousands of investors were ruined, and billions of dollars had been lost; many stocks could not be sold at any price.<ref name=":4" /> The market recovered 12% on Wednesday, but the damage had been done. Though the market recovered from 14 November until 17 April 1930, the market entered a prolonged slump. From 17 April 1930 until 8 July 1932, the market lost 89% of its value.<ref>According to the Federal Reserve Bank of St. Louis Economic Data website, based on a monthly timeseries 1929 September – 1932 June, the Dow Jones Industrial Average lost 87.1% while the Cowles Commission and S&P's all stock index lost 85.0%: https://fred.stlouisfed.org/graph/?g=qj2m , https://fred.stlouisfed.org/graph/?g=qj2l.</ref>[[File:Bank of the United States failure NYWTS.jpg|thumb|upright=1.2|Crowds outside the [[Bank of United States]] in New York after its failure in 1931]]Despite the crash, the worst of the crisis did not reverberate around the world until after 1929. The crisis hit panic levels again in December 1930, with a [[bank run]] on the [[Bank of United States]] (privately run, no relation to the government). Unable to pay out to all of its creditors, the bank failed.<ref>{{Cite journal |last=Gordon |first=John Steele |date=November–December 2018 |title=The Bank of United States |url=https://www.proquest.com/docview/2160290916 |journal=ABA Banking Journal |volume=110 |issue=6 |pages=58 |id={{ProQuest|2160290916}}}}</ref><ref>{{Cite journal |last=Calomiris |first=Charles W. |date=November 2007 |title=Bank Failures in Theory and History: The Great Depression and Other "Contagious" Events |url=https://www.nber.org/papers/w13597 |journal=National Bureau of Economic Research|series=Working Paper Series |doi=10.3386/w13597 |s2cid=154123748 |doi-access=free }}</ref> Among the 608 American banks that closed in November and December 1930, the Bank of United States accounted for a third of the total $550 million deposits lost and, with its closure, bank failures reached a critical mass.<ref>{{Citation |last=Ferguson |first=Niall |title=The Ascent of Money |date=October 2009 |pages=163 |publisher=Penguin |isbn=978-986-173-584-9}}</ref> === The Smoot–Hawley act and the breakdown of international trade === {{Main|Smoot–Hawley Tariff Act}} [[File:Smoot_and_Hawley_standing_together,_April_11,_1929.jpg|thumb|left|[[Willis C. Hawley]] (left) and [[Reed Smoot]] in April 1929, shortly before the Smoot–Hawley Tariff Act passed the House of Representatives]] The [[Smoot–Hawley Tariff Act]] was passed in the United States on 17 June 1930, having been proposed the year prior. Ostensibly aimed at protecting the American economy as the Depression began to take root, it backfired enormously and may have even caused the Depression. The consensus view among economists and economic historians (including Keynesians, Monetarists and Austrian economists) is that the passage of the Smoot–Hawley Tariff exacerbated the Great Depression,<ref>{{Cite journal |last=Whaples |first=Robert |author-link=Robert Whaples |date=March 1995 |title=Where Is There Consensus Among American Economic Historians? The Results of a Survey on Forty Propositions |journal=[[The Journal of Economic History]] |publisher=[[Cambridge University Press]] |volume=55 |issue=1 |page=144 |doi=10.1017/S0022050700040602 |jstor=2123771 |s2cid=145691938}}</ref> although there is disagreement as to how much. In the popular view, the Smoot–Hawley Tariff was a leading cause of the depression.<ref>[https://krugman.blogs.nytimes.com/2009/11/30/protectionism-and-the-great-depression/ "Protectionism and the Great Depression"] {{Webarchive|url=https://web.archive.org/web/20210225033620/https://krugman.blogs.nytimes.com/2009/11/30/protectionism-and-the-great-depression/|date=February 25, 2021}}, [[Paul Krugman]], ''[[New York Times]],'' November 30, 2009</ref><ref name="eichenirwin">Barry Eichengreen, Douglas Irwin (March 17, 2009). [https://voxeu.org/index.php?q=node/3280 "The protectionist temptation: Lessons from the Great Depression for today"] {{Webarchive|url=https://web.archive.org/web/20120524215509/http://voxeu.org/index.php?q=node%2F3280|date=May 24, 2012}}. VOX.</ref> In a 1995 survey of American economic historians, two-thirds agreed that the [[Smoot–Hawley Tariff Act]] at least worsened the Great Depression.<ref name="ReferenceB" /> According to the U.S. Senate website, the Smoot–Hawley Tariff Act is among the most catastrophic acts in congressional history.<ref name="Senate_On_Smoot-Hawley Act">{{cite web |title=The Senate Passes the Smoot-Hawley Tariff |url=https://www.senate.gov/artandhistory/history/minute/Senate_Passes_Smoot_Hawley_Tariff.htm |url-status=live |archive-url=https://web.archive.org/web/20211020163037/https://www.senate.gov/artandhistory/history/minute/Senate_Passes_Smoot_Hawley_Tariff.htm |archive-date=October 20, 2021 |access-date=May 3, 2020 |website=United States Senate }}</ref> 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. Most historians and economists blame the Act 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.<ref>{{cite web |title=The World in Depression |url=https://www.mtholyoke.edu/acad/intrel/depress.htm |url-status=dead |archive-url=https://web.archive.org/web/20080310145946/https://www.mtholyoke.edu/acad/intrel/depress.htm |archive-date=March 10, 2008 |access-date=May 22, 2008 |publisher=[[Mount Holyoke College]]}}</ref> The average ''[[ad valorem]]'' (value based) rate of duties on dutiable imports for 1921–1925 was 25.9% but under the new tariff it jumped to 50% during 1931–1935. In dollar terms, American exports declined over the next four 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 {{frac|1|3}} as written. Hardest hit were farm commodities such as wheat, cotton, tobacco, and lumber.{{Citation needed|date=October 2022}} 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 triggered much tension among countries that had large amounts of bilateral trade, causing major export-import reductions during the depression. Not all governments enforced the same measures of protectionism. Some countries raised tariffs drastically and enforced severe restrictions on foreign exchange transactions, while other countries reduced "trade and exchange restrictions only marginally":<ref name="Eichengreen">{{cite journal |last1=Eichengreen |first1=B. |last2=Irwin |first2=D. A. |year=2010 |title=The Slide to Protectionism in the Great Depression: Who Succumbed and Why? |url=https://www.nber.org/papers/w15142.pdf |url-status=live |journal=Journal of Economic History |volume=70 |issue=4 |pages=871–897 |doi=10.1017/s0022050710000756 |archive-url=https://web.archive.org/web/20190514111715/https://www.nber.org/papers/w15142.pdf |archive-date=May 14, 2019 |access-date=February 18, 2022 |s2cid=18906612}}</ref> * "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.<ref name="Eichengreen" /> * Countries that abandoned the gold standard allowed their currencies to [[Currency appreciation and depreciation|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.<ref name="Eichengreen" /> * "The length and depth of a country's economic downturn and the timing and vigor of its recovery are 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."<ref name="Eichengreen" /> === The gold standard and the spreading of global depression === The [[gold standard]] was the primary transmission mechanism of the Great Depression. Even countries that did not face bank failures and a monetary contraction first-hand were forced to join the deflationary policy since higher interest rates in countries that performed a deflationary policy led to a gold outflow in countries with lower interest rates. Under the gold standard's [[price–specie flow mechanism]], countries that lost gold but nevertheless wanted to maintain the gold standard had to permit their money supply to decrease and the domestic price level to decline ([[deflation]]).<ref>Peter Temin, Gianni Toniolo, ''The World Economy between the Wars'', Oxford University Press, 2008, {{ISBN|978-0-19-804201-3}}, p. 106</ref><ref>Randall E. Parker, ''Reflections on the Great Depression'', Elgar publishing, 2003, {{ISBN|978-1-84376-335-2}}, p. 22.</ref> There is also consensus that protectionist policies, and primarily the passage of the [[Smoot–Hawley Tariff Act]], helped to exacerbate, or even cause the Great Depression.<ref name="ReferenceB">{{Cite journal |last1=Whaples |first1=Robert |year=1995 |title=Where is There Consensus Among American Economic Historians? The Results of a Survey on Forty Propositions |journal=The Journal of Economic History |volume=55 |issue=1 |pages=139–154 |doi=10.1017/S0022050700040602 |jstor=2123771 |s2cid=145691938}}</ref> ==== Gold standard ==== [[File:Graph charting income per capita throughout the Great Depression.svg|thumb|upright=1.8|The Depression in international perspective<ref>International data from {{cite web |last=Maddison |first=Angus |author-link=Angus Maddison |title=Historical Statistics for the World Economy: 1–2003 AD |url=https://www.ggdc.net/Maddison/Historical_Statistics/}}{{dead link|date=May 2017|bot=InternetArchiveBot|fix-attempted=yes}}. Gold dates culled from historical sources, principally {{Cite book |last=Eichengreen |first=Barry |url=https://archive.org/details/goldenfettersgol00eich |title=Golden Fetters: The Gold Standard and the Great Depression, 1919–1939 |publisher=Oxford University Press |year=1992 |isbn=0-19-506431-3 |location=New York |author-link=Barry Eichengreen}}</ref>]] Some economic studies have indicated that just as the downturn was spread worldwide by the rigidities of the [[gold standard]], it was suspending gold convertibility (or devaluing the currency in gold terms) that did the most to make recovery possible.<ref>{{Cite book |last=Eichengreen |first=Barry |url=https://archive.org/details/goldenfettersgol00eich |title=Golden Fetters: The Gold Standard and the Great Depression, 1919–1939 |publisher=Oxford University Press |year=1992 |isbn=0-19-506431-3 |location=New York |author-link=Barry Eichengreen}}</ref> Every major currency left the gold standard during the Great Depression. The UK was the first to do so. Facing [[speculative attack]]s on the [[Pound sterling|pound]] and depleting [[Official gold reserves|gold reserves]], in September 1931 the [[Bank of England]] ceased exchanging pound notes for gold and the pound was floated on foreign exchange markets. Japan and the Scandinavian countries joined the United Kingdom in leaving the gold standard in 1931. Other countries, such as Italy and the United States, remained on the gold standard into 1932 or 1933, while a few countries in the so-called "gold bloc", led by France and including Poland, Belgium and Switzerland, stayed on the standard until 1935–36. According to later analysis, the earliness with which a country left the gold standard reliably predicted its economic recovery. For example, The UK 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 country|developing countries]]. This partly explains why the experience and length of the depression differed between regions and states around the world.<ref>{{Cite journal |last=Bernanke |first=Ben |date=March 2, 2004 |title=Remarks by Governor Ben S. Bernanke: Money, Gold and the Great Depression |url=https://www.federalreserve.gov/boarddocs/speeches/2004/200403022/default.htm |url-status=live |journal=At the H. Parker Willis Lecture in Economic Policy, Washington and Lee University, Lexington, Virginia |archive-url=https://web.archive.org/web/20220215053205/https://www.federalreserve.gov/boarddocs/speeches/2004/200403022/default.htm |archive-date=February 15, 2022 |access-date=February 18, 2022}}</ref> ==== German banking crisis of 1931 and British crisis ==== The financial crisis escalated out of control in mid-1931, starting with the collapse of the [[Creditanstalt|Credit Anstalt]] in Vienna in May.<ref>[[Charles Loch Mowat]], ''Britain between the wars, 1918–1940'' (1955) pp. 379–385.</ref><ref name="William Ashworth 1962 pp. 237-244">William Ashworth, ''A short history of the international economy since 1850'' (2nd ed. 1962) pp. 237–244.</ref> This put heavy pressure on Germany, which was already in political turmoil. With the rise in violence of Nazi and communist movements, as well as investor nervousness at harsh government financial policies,<ref name="Isabel Schnabel 1931">Isabel Schnabel, "The German twin crisis of 1931". ''Journal of Economic History'' 64#3 (2004): 822–871.</ref> investors withdrew their short-term money from Germany as confidence spiraled downward. The Reichsbank lost 150 million marks in the first week of June, 540 million in the second, and 150 million in two days, 19–20 June. Collapse was at hand. U.S. President Herbert Hoover called for a [[Hoover Moratorium|moratorium on Payment of war reparations]]. This angered Paris, which depended on a steady flow of German payments, but it slowed the crisis down, and the moratorium was agreed to in July 1931. An International conference in London later in July produced no agreements but on August 19 a standstill agreement froze Germany's foreign liabilities for six months. Germany received emergency funding from private banks in New York as well as the Bank of International Settlements and the Bank of England. The funding only slowed the process. Industrial failures began in Germany, a major bank closed in July and a two-day holiday for all German banks was declared. Business failures were more frequent in July, and spread to [[Kingdom of Romania|Romania]] and Hungary. The crisis continued to get worse in Germany, bringing political upheaval that finally led to the [[Adolf Hitler's rise to power|coming to power of Hitler's Nazi regime]] in January 1933.<ref name="V. Hodson, 1938 pp. 64-76">H. V. Hodson (1938), ''Slump and Recovery, 1929–1937'' (London), pp. 64–76.</ref> The world financial crisis now began to overwhelm Britain; investors around the world started withdrawing their gold from London at the rate of £2.5 million per day.<ref name="David Williams 1963">{{cite journal |last1=Williams |first1=David |year=1963 |title=London and the 1931 financial crisis |journal=Economic History Review |volume=15 |issue=3 |pages=513–528 |doi=10.2307/2592922 |jstor=2592922}}</ref> Credits of £25 million each from the Bank of France and the Federal Reserve Bank of New York and an issue of £15 million fiduciary note slowed, but did not reverse, the British crisis. The financial crisis now caused a major political crisis in Britain in August 1931. With deficits mounting, the bankers demanded a balanced budget; the divided cabinet of Prime Minister Ramsay MacDonald's Labour government agreed; it proposed to raise taxes, cut spending, and most controversially, to cut unemployment benefits 20%. The attack on welfare was unacceptable to the Labour movement. MacDonald wanted to resign, but King George V insisted he remain and form an all-party coalition "[[National Government (United Kingdom)|National Government]]". The Conservative and Liberals parties signed on, along with a small cadre of Labour, but the vast majority of Labour leaders denounced MacDonald as a traitor for leading the new government. Britain went off the [[gold standard]], and suffered relatively less than other major countries in the Great Depression. In the 1931 British election, the Labour Party was virtually destroyed, leaving MacDonald as prime minister for a largely Conservative coalition.<ref>Mowat (1955), ''Britain between the wars, 1918–1940'', pp. 386–412.</ref><ref name="John Oxborrow 1976 pp. 67-73">Sean Glynn and John Oxborrow (1976), ''Interwar Britain : a social and economic history'', pp. 67–73.</ref> === Turning point and recovery === [[File:GDP depression.svg|thumb|upright=1.8|The overall course of the Depression in the United States, as reflected in per-capita GDP (average income per person) shown in constant year 2000 dollars, plus some of the key events of the period. Dotted red line = long-term trend 1920–1970.<ref name=":0">Per-capita GDP data from [https://www.measuringworth.org/usgdp/ MeasuringWorth: What Was the U.S. GDP Then?] {{Webarchive|url=https://web.archive.org/web/20100904025051/http://www.measuringworth.org/usgdp/|date=September 4, 2010}}</ref>]] In most countries of the world, recovery from the Great Depression began in 1933.<ref name="Britannica" /> In the U.S., recovery began in early 1933,<ref name="Britannica" /> but the U.S. did not return to 1929 GNP for over a decade and still had an unemployment rate of about 15% in 1940, albeit down from the high of 25% in 1933. There is no consensus among economists regarding the motive force for the U.S. economic expansion that continued through most of the [[Franklin D. Roosevelt#Presidency (1933–1945)|Roosevelt years]] (and the 1937 recession that interrupted it). The common view among most economists is that Roosevelt's [[New Deal]] policies either caused or accelerated the recovery, although his policies were never aggressive enough to bring the economy completely out of recession. Some economists have also called attention to the positive effects from expectations of [[reflation]] and rising nominal interest rates that Roosevelt's words and actions portended.<ref>Gauti B. Eggertsson, "Great Expectations and the End of the Depression", ''American Economic Review'' 98, No. 4 (September 2008): 1476–1516</ref><ref>"Was the New Deal Contractionary?" [[Federal Reserve Bank of New York]] Staff Report 264, October 2006, [https://www.newyorkfed.org/research/staff_reports/sr264.html Gauti B. Eggertsson] {{Webarchive|url=https://web.archive.org/web/20220212162504/https://www.newyorkfed.org/research/staff_reports/sr264.html|date=February 12, 2022}}</ref> It was the rollback of those same reflationary policies that led to the interruption of a recession beginning in late 1937.<ref>"The Mistake of 1937: A General Equilibrium Analysis", ''Monetary and Economic Studies'' 24, No. S-1 (December 2006), [https://www.imes.boj.or.jp/english/publication/mes/2006/abst/me24-s1-8.html Boj.or.jp] {{Webarchive|url=https://web.archive.org/web/20150811112759/https://www.imes.boj.or.jp/english/publication/mes/2006/abst/me24-s1-8.html|date=August 11, 2015}}</ref><ref>{{cite journal |last1=Eggertsson |first1=Gauti B. |title=A Reply to Steven Horwitz's Commentary on 'Great Expectations and the End of the Great Depression' |url=https://econjwatch.org/articles/a-reply-to-steven-horwitz-s-commentary-on-great-expectations-and-the-end-of-the-depression- |url-status=live |journal=Econ Journal Watch |volume=7 |issue=3 |pages=197–204 |archive-url=https://web.archive.org/web/20220215053116/https://econjwatch.org/articles/a-reply-to-steven-horwitz-s-commentary-on-great-expectations-and-the-end-of-the-depression- |archive-date=February 15, 2022 |access-date=February 18, 2022}}</ref> One contributing policy that reversed reflation was the [[Banking Act of 1935]], which effectively raised reserve requirements, causing a monetary contraction that helped to thwart the recovery.<ref>Steven Horwitz, "Unfortunately Unfamiliar with Robert Higgs and Others: A Rejoinder to Gauti Eggertsson on the 1930s", ''Econ Journal Watch'' 8(1), 2, January 2011. [https://econjwatch.org/articles/unfortunately-unfamiliar-with-robert-higgs-and-others-a-rejoinder-to-gauti-eggertsson-on-the-1930s] {{Webarchive|url=https://web.archive.org/web/20220215053127/https://econjwatch.org/articles/unfortunately-unfamiliar-with-robert-higgs-and-others-a-rejoinder-to-gauti-eggertsson-on-the-1930s|date=February 15, 2022}}</ref> GDP returned to its upward trend in 1938.<ref name=":0" /> A revisionist view among some economists holds that the New Deal prolonged the Great Depression, as they argue that [[National Industrial Recovery Act of 1933]] and [[National Labor Relations Act of 1935]] restricted competition and established price fixing.<ref>{{Cite journal |last1=Hannsgen |first1=Greg |last2=Papadimitriou |first2=Dimitri |date=2010 |title=Did the New Deal Prolong or Worsen the Great Depression? |url=https://www.jstor.org/stable/40722622 |journal=Challenge |volume=53 |issue=1 |pages=63–86 |doi=10.2753/0577-5132530103 |jstor=40722622 |s2cid=153490746 |issn=0577-5132}}</ref> [[John Maynard Keynes]] did not think that the New Deal under Roosevelt single-handedly ended the Great Depression: "It is, it seems, politically impossible for a capitalistic democracy to organize expenditure on the scale necessary to make the grand experiments which would prove my case—except in war conditions."<ref>Quoted by P. Renshaw. ''Journal of Contemporary History''. 1999 vol. 34 (3). pp. 377–364</ref> According to [[Christina Romer]], the money supply growth caused by huge international gold inflows was a crucial source of the recovery of the United States economy, and that the economy showed little sign of self-correction. The gold inflows were partly due to [[Executive Order 6102|devaluation of the U.S. dollar]] and partly due to deterioration of the political situation in Europe.<ref>{{Cite journal |last=Romer |first=Christina D. |date=December 1992 |title=What Ended the Great Depression |url=https://elsa.berkeley.edu/~cromer/What%20Ended%20the%20Great%20Depression.pdf |url-status=dead |journal=Journal of Economic History |volume=52 |issue=4 |pages=757–84 |citeseerx=10.1.1.207.844 |doi=10.1017/S002205070001189X |archive-url=https://web.archive.org/web/20130117093624/https://elsa.berkeley.edu/~cromer/What%20Ended%20the%20Great%20Depression.pdf |archive-date=January 17, 2013 |quote=monetary development were crucial to the recovery implies that self-correction played little role in the growth of real output}}</ref> In their book, ''[[A Monetary History of the United States]]'', [[Milton Friedman]] and [[Anna J. Schwartz]] also attributed the recovery to monetary factors, and contended that it was much slowed by poor management of money by the [[Federal Reserve System]]. [[Chairman of the Federal Reserve]] (2006–2014) [[Ben Bernanke]] agreed that monetary factors played important roles both in the worldwide economic decline and eventual recovery.<ref>Ben Bernanke. ''Essays on the Great Depression''. Princeton University Press. {{ISBN|978-0-691-01698-6}}. p. 7</ref> Bernanke also saw a strong role for institutional factors, particularly the rebuilding and restructuring of the financial system,<ref>Ben S. Bernanke, "Nonmonetary Effects of the Financial Crisis in the Propaga-tion of the Great Depression", ''The American Economic Review 73'', No. 3 (June 1983): 257–276, available from the St. Louis Federal Reserve Bank collection at [https://fraser.stlouisfed.org/scribd/?item_id=2348&filepath=/docs/publications/aer/aer_1983_bernanke_nonmonetary_effects.pdf Stlouisfed.org] {{Webarchive|url=https://web.archive.org/web/20160305072448/https://fraser.stlouisfed.org/scribd/?item_id=2348&filepath=%2Fdocs%2Fpublications%2Faer%2Faer_1983_bernanke_nonmonetary_effects.pdf|date=March 5, 2016}}</ref> and pointed out that the Depression should be examined in an international perspective.<ref>{{cite journal |last=Bernanke |first=Ben S. |date=February 1995 |title=The Macroeconomics of the Great Depression: A Comparative Approach |url=https://fraser.stlouisfed.org/scribd/?item_id=2399&filepath=/docs/meltzer/bermac95.pdf |url-status=live |journal=Journal of Money, Credit and Banking |publisher=Fraser.stlouisfed.org |volume=27 |issue=1 |pages=1–28 |doi=10.2307/2077848 |jstor=2077848 |archive-url=https://web.archive.org/web/20160304201917/https://fraser.stlouisfed.org/scribd/?item_id=2399&filepath=%2Fdocs%2Fmeltzer%2Fbermac95.pdf |archive-date=March 4, 2016 |access-date=October 16, 2014}}</ref> ==== Role of women and household economics ==== Women's primary role was as housewives; without a steady flow of family income, their work became much harder in dealing with food and clothing and medical care. Birthrates fell everywhere, as children were postponed until families could financially support them. The average birthrate for 14 major countries fell 12% from 19.3 births per thousand population in 1930, to 17.0 in 1935.<ref>W. S. Woytinsky and E. S. Woytinsky, ''World population and production: trends and outlook'' (1953) p. 148</ref> In Canada, half of Roman Catholic women defied Church teachings and used contraception to postpone births.<ref>Denyse Baillargeon, ''Making Do: Women, Family and Home in Montreal during the Great Depression'' (Wilfrid Laurier University Press, 1999), p. 159.</ref> Among the few women in the labor force, layoffs were less common in the white-collar jobs and they were typically found in light manufacturing work. However, there was a widespread demand to limit families to one paid job, so that wives might lose employment if their husband was employed.<ref>{{cite book |last=Stephenson |first=Jill |url=https://books.google.com/books?id=-rqOAwAAQBAJ&pg=PA3 |title=Women in Nazi Germany |publisher=Taylor & Francis |year=2014 |isbn=978-1-317-87607-6 |pages=3–5 |access-date=June 27, 2015 |archive-url=https://web.archive.org/web/20210816172022/https://books.google.com/books?id=-rqOAwAAQBAJ&pg=PA3 |archive-date=August 16, 2021 |url-status=live}}</ref><ref>{{cite book |author=Susan K. Foley |url=https://archive.org/details/womeninfrancesin00fole |title=Women in France Since 1789: The Meanings of Difference |publisher=Palgrave Macmillan |year=2004 |isbn=978-0-230-80214-8 |pages=[https://archive.org/details/womeninfrancesin00fole/page/186 186]–90 |author-link1=Susan Foley |url-access=registration}}</ref><ref>{{cite book |last=Srigley |first=Katrina |url=https://archive.org/details/breadwinningdaug00srig |title=Breadwinning Daughters: Young Working Women in a Depression-era City, 1929–1939 |publisher=University of Toronto Press |year=2010 |isbn=978-1-4426-1003-3 |page=[https://archive.org/details/breadwinningdaug00srig/page/135 135] |url-access=registration}}</ref> Across Britain, there was a tendency for married women to join the labor force, competing for part-time jobs especially.<ref>Jessica S. Bean, {{"'}}To help keep the home going': female labour supply in interwar London". ''Economic History Review'' (2015) 68#2 pp. 441–470.</ref><ref>Deirdre Beddoe, ''Back to Home and Duty: Women Between the Wars, 1918–1939'' (1989).</ref> In France, very slow population growth, especially in comparison to Germany continued to be a serious issue in the 1930s. Support for increasing welfare programs during the depression included a focus on women in the family. The Conseil Supérieur de la Natalité campaigned for provisions enacted in the Code de la Famille (1939) that increased state assistance to families with children and required employers to protect the jobs of fathers, even if they were immigrants.<ref>{{cite journal |last1=Camiscioli |first1=Elisa |author-link=Elisa Camiscioli |year=2001 |title=Producing Citizens, Reproducing the 'French Race': Immigration, Demography, and Pronatalism in Early Twentieth-Century France |journal=Gender & History |volume=13 |issue=3 |pages=593–621 |doi=10.1111/1468-0424.00245 |pmid=18198513 |s2cid=20333294}}</ref> In rural and small-town areas, women expanded their operation of vegetable gardens to include as much food production as possible. In the United States, agricultural organizations sponsored programs to teach housewives how to optimize their gardens and to raise poultry for meat and eggs.<ref>Ann E. McCleary, {{"'}}I Was Really Proud of Them': Canned Raspberries and Home Production During the Farm Depression". ''Augusta Historical Bulletin'' (2010), Issue 46, pp. 14–44.</ref> Rural women made [[feed sack dress]]es and other items for themselves and their families and homes from feed sacks.<ref>{{Cite web |last=Vogelsang |first=Willem |title=3. Feedsacks and the Great Depression |url=https://trc-leiden.nl/trc-digital-exhibition/index.php/for-a-few-sacks-more/item/119-3-feedsacks-and-the-great-depression |url-status=live |archive-url=https://web.archive.org/web/20210415092351/https://trc-leiden.nl/trc-digital-exhibition/index.php/for-a-few-sacks-more/item/119-3-feedsacks-and-the-great-depression |archive-date=April 15, 2021 |access-date=March 21, 2020 |website=trc-leiden.nl |language=en-gb}}</ref> In American cities, African American women quiltmakers enlarged their activities, promoted collaboration, and trained neophytes. Quilts were created for practical use from various inexpensive materials and increased social interaction for women and promoted camaraderie and personal fulfillment.<ref>{{cite journal |last1=Klassen |first1=Tari |year=2008 |title=How Depression-Era Quiltmakers Constructed Domestic Space: An Interracial Processual Study |journal=Midwestern Folklore |volume=34 |issue=2 |pages=17–47}}</ref> Oral history provides evidence for how housewives in a modern industrial city handled shortages of money and resources. Often they updated strategies their mothers used when they were growing up in poor families. Cheap foods were used, such as soups, beans and noodles. They purchased the cheapest cuts of meat—sometimes even horse meat—and recycled the [[Sunday roast]] into sandwiches and soups. They sewed and patched clothing, traded with their neighbors for outgrown items, and made do with colder homes. New furniture and appliances were postponed until better days. Many women also worked outside the home, or took boarders, did laundry for trade or cash, and did sewing for neighbors in exchange for something they could offer. Extended families used mutual aid—extra food, spare rooms, repair-work, cash loans—to help cousins and in-laws.<ref>Baillargeon, ''Making Do: Women, Family and Home in Montreal during the Great Depression'' (1999), pp. 70, 108, 136–138, 159.</ref> In Japan, official government policy was deflationary and the opposite of Keynesian spending. Consequently, the government launched a campaign across the country to induce households to reduce their consumption, focusing attention on spending by housewives.<ref>{{cite journal |last1=Metzler |first1=Mark |year=2004 |title=Woman's Place in Japan's Great Depression: Reflections on the Moral Economy of Deflation |journal=Journal of Japanese Studies |volume=30 |issue=2 |pages=315–352 |doi=10.1353/jjs.2004.0045 |s2cid=146273711}}</ref> In Germany, the government tried to reshape private household consumption under the Four-Year Plan of 1936 to achieve German economic self-sufficiency. The Nazi women's organizations, other propaganda agencies and the authorities all attempted to shape such consumption as economic self-sufficiency was needed to prepare for and to sustain the coming war. The organizations, propaganda agencies and authorities employed slogans that called up traditional values of thrift and healthy living. However, these efforts were only partly successful in changing the behavior of housewives.<ref>{{cite journal |last1=Reagin |first1=N. R. |year=2001 |title=Marktordnung and Autarkic Housekeeping: Housewives and Private Consumption under the Four-Year Plan, 1936–1939 |journal=German History |volume=19 |issue=2 |pages=162–184 |doi=10.1191/026635501678771619 |pmid=19610237}}</ref> ==== World War II and recovery ==== [[File:WomanFactory1940s.jpg|thumb|A female factory worker in 1942, [[Fort Worth, Texas]]. Women entered the workforce as men were drafted into the armed forces.]] The common view among economic historians is that the Great Depression ended with the advent of [[World War II]]. Many economists believe that government spending on the war caused or at least accelerated recovery from the Great Depression, though some consider that it did not play a very large role in the recovery, though it did help in reducing unemployment.<ref name="Britannica" /><ref name="Galbraith">Referring to the effect of World War II spending on the economy, economist [[John Kenneth Galbraith]] said, "One could not have had a better demonstration of the Keynesian ideas." {{cite video |url=https://www.pbs.org/wgbh/commandingheights/lo/story/ch_menu.html |title=Commanding Heights, see chapter 6 video or transcript |date=2002 |medium=TV documentary |publisher=[[Public Broadcasting Service|PBS]] |location=U.S. |people=[[Daniel Yergin]], William Cran (writers / producer)}}</ref><ref>{{Cite journal |last=Romer |first=Christina D. |author-link=Christina Romer |year=1992 |title=What Ended the Great Depression? |journal=Journal of Economic History |volume=52 |issue=4 |pages=757–784 |doi=10.1017/S002205070001189X |quote=fiscal policy was of little consequence even as late as 1942, suggests an interesting twist on the usual view that World War II caused, or at least accelerated, the recovery from the Great Depression.}}</ref><ref>{{Cite journal |last=Higgs |first=Robert |date=March 1, 1992 |title=Wartime Prosperity? A Reassessment of the U.S. Economy in the 1940s |journal=The Journal of Economic History |volume=52 |issue=1 |pages=41–60 |doi=10.1017/S0022050700010251 |issn=1471-6372 |s2cid=154484756}}</ref> The rearmament policies leading up to World War II helped stimulate the economies of Europe in 1937–1939. By 1937, unemployment in Britain had fallen to 1.5 million. The [[mobilization]] of manpower following the outbreak of war in 1939 ended unemployment.<ref name="Great Depression and World War II">[https://www.americaslibrary.gov/jb/wwii/jb_wwii_subj.html "Great Depression and World War II"] {{Webarchive|url=https://web.archive.org/web/20220124140816/https://www.americaslibrary.gov/jb/wwii/jb_wwii_subj.html|date=January 24, 2022}}. Library of Congress.</ref> The American mobilization for [[World War II]] at the end of 1941 moved approximately ten million people out of the civilian labor force and into the war.<ref>Selective Service System. (May 27, 2003). ''[http://www.sss.gov/induct.htm Induction Statistics. In Inductions (by year) from World War I Through the End of the Draft (1973)] {{Webarchive|url=https://web.archive.org/web/20090507211238/http://www.sss.gov/induct.htm |date=May 7, 2009 }}''. Retrieved September 8, 2013.</ref> This finally eliminated the last effects from the Great Depression and brought the U.S. unemployment rate down below 10%.<ref name="Depression & World War II">[https://www.americaslibrary.gov/cgi-bin/page.cgi/jb/wwii "Depression & WWII"] {{webarchive|url=https://web.archive.org/web/20090625204217/https://www.americaslibrary.gov/cgi-bin/page.cgi/jb/wwii|date=June 25, 2009}}. Americaslibrary.gov.</ref> World War II had a dramatic effect on many parts of the American economy.<ref name="Bloomberg">{{cite news|url=http://www.bloombergview.com/articles/2011-12-16/how-did-world-war-ii-end-the-great-depression-echoes|publisher=Bloomberg|title=How Did World War II End the Great Depression?: Echoes|author=Hyman, Louis|author-link=Louis Hyman|date=December 16, 2011|access-date=August 25, 2015|archive-date=May 3, 2016|archive-url=https://web.archive.org/web/20160503051054/http://www.bloombergview.com/articles/2011-12-16/how-did-world-war-ii-end-the-great-depression-echoes|url-status=dead}}</ref> Government-financed capital spending accounted for only 5% of the annual U.S. investment in industrial capital in 1940; by 1943, the government accounted for 67% of U.S. capital investment.<ref name="Bloomberg"/> The massive war spending doubled economic growth rates, either masking the effects of the Depression or essentially ending the Depression. Businessmen ignored the mounting [[National debt of the United States|national debt]] and heavy new taxes, redoubling their efforts for greater output to take advantage of generous government contracts.<ref>Richard J. Jensen, [https://rjensen.people.uic.edu/causes-cures.pdf "The causes and cures of unemployment in the Great Depression"] {{Webarchive|url=https://web.archive.org/web/20211102124644/https://rjensen.people.uic.edu/causes-cures.pdf|date=November 2, 2021}}. ''Journal of Interdisciplinary History'' 19.4 (1989): 553–583.</ref> ==Causes== {{Main|Causes of the Great Depression}} [[File:Money_supply_during_the_great_depression_era.png|upright=1.8|thumb|right| Money supply decreased considerably between [[Black Tuesday]] and the [[Emergency Banking Act|Bank Holiday in March 1933]], when there were massive [[bank runs]] across the United States.]] [[File:CPI 1914-2022.webp|thumb|alt=CPI 1914–2022|400px| {{legend|#0076BA |[[Inflation]]}} {{legend|#EE220C |[[Deflation]]}} {{legend-line|#1DB100 solid 3px|[[Money supply|M2 money supply]] increases Year/Year}} ]] [[File:1930Industry.svg|right|thumb|upright=1.35|U.S. industrial production, 1928–1939]] The two classic competing economic theories of the Great Depression are the [[Keynesian economics|Keynesian]] (demand-driven) and the [[Monetarism|Monetarist]] explanation.<ref>{{Cite web|first1=Nick|last1=Lioudis|title=What is the difference between Keynesian and monetarist economics?|url=https://www.investopedia.com/ask/answers/012615/what-difference-between-keynesian-economics-and-monetarist-economics.asp|access-date=July 12, 2021|website=Investopedia|language=en|archive-date=December 20, 2021|archive-url=https://web.archive.org/web/20211220193534/https://www.investopedia.com/ask/answers/012615/what-difference-between-keynesian-economics-and-monetarist-economics.asp|url-status=live}}</ref> There are also various [[Heterodox economics|heterodox theories]] that downplay or reject the explanations of the Keynesians and monetarists. The consensus among demand-driven theories is that a large-scale loss of confidence led to a sudden reduction in consumption and investment spending. Once panic and deflation set in, many people believed they could avoid further losses by keeping clear of the markets. Holding money became profitable as prices dropped lower and a given amount of money bought ever more goods, exacerbating the drop in demand.<ref>{{Cite web|title=Great Depression – Causes of the decline|url=https://www.britannica.com/event/Great-Depression|access-date=July 12, 2021|website=Encyclopedia Britannica|language=en|archive-date=May 9, 2015|archive-url=https://web.archive.org/web/20150509121741/https://www.britannica.com/EBchecked/topic/243118/Great-Depression|url-status=live}}</ref> Monetarists believe that the Great Depression started as an ordinary recession, but the shrinking of the [[money supply]] greatly exacerbated the economic situation, causing a recession to descend into the Great Depression.<ref>{{Cite web|last=Hayes|first=Adam|title=What is a Monetarist?|url=https://www.investopedia.com/terms/m/monetarist.asp|access-date=July 12, 2021|website=Investopedia|language=en|archive-date=November 5, 2021|archive-url=https://web.archive.org/web/20211105044704/https://www.investopedia.com/terms/m/monetarist.asp|url-status=live}}</ref> Economists and economic historians are almost evenly split as to whether the traditional monetary explanation that monetary forces were the primary cause of the Great Depression is right, or the traditional Keynesian explanation that a fall in autonomous spending, particularly investment, is the primary explanation for the onset of the Great Depression.<ref name="in JSTOR">{{cite journal|at=p. 150|jstor=2123771|url=https://www.employees.csbsju.edu/jolson/ECON315/Whaples2123771.pdf|title=Where is There Consensus Among American Economic Historians? The Results of a Survey on Forty Propositions|journal=The Journal of Economic History|volume=55|issue=1|last1=Whaples|first1=Robert|year=1995|doi=10.1017/S0022050700040602|citeseerx=10.1.1.482.4975|s2cid=145691938 |access-date=February 18, 2022|archive-date=November 4, 2021|archive-url=https://web.archive.org/web/20211104183848/http://www.employees.csbsju.edu/jolson/econ315/whaples2123771.pdf|url-status=live}}</ref> Today there is also significant academic support for the [[debt deflation]] theory and the [[expectations hypothesis]] that – building on the monetary explanation of [[Milton Friedman]] and [[Anna Schwartz]] – add non-monetary explanations.<ref>{{Cite journal|last1=Mendoza|first1=Enrique G.|last2=Smith|first2=Katherine A.|date=September 1, 2006|title=Quantitative implications of a debt-deflation theory of Sudden Stops and asset prices|url=https://www.sciencedirect.com/science/article/pii/S002219960500098X|journal=Journal of International Economics|language=en|volume=70|issue=1|pages=82–114|doi=10.1016/j.jinteco.2005.06.016|issn=0022-1996|access-date=February 18, 2022|archive-date=February 18, 2022|archive-url=https://web.archive.org/web/20220218125338/https://www.sciencedirect.com/science/article/abs/pii/S002219960500098X|url-status=live}}</ref><ref>{{Cite journal|last1=Buraschi|first1=Andrea|last2=Jiltsov|first2=Alexei|date=February 1, 2005|title=Inflation risk premia and the expectations hypothesis|url=https://www.sciencedirect.com/science/article/pii/S0304405X04001333|journal=Journal of Financial Economics|language=en|volume=75|issue=2|pages=429–490|doi=10.1016/j.jfineco.2004.07.003|issn=0304-405X|access-date=February 18, 2022|archive-date=February 18, 2022|archive-url=https://web.archive.org/web/20220218125325/https://www.sciencedirect.com/science/article/abs/pii/S0304405X04001333|url-status=live}}</ref> There is a consensus that the [[Federal Reserve System]] should have cut short the process of monetary deflation and banking collapse, by expanding the money supply and acting as [[lender of last resort]]. If they had done this, the economic downturn would have been far less severe and much shorter.<ref>{{cite journal|at=p. 143|jstor=2123771|url=https://www.employees.csbsju.edu/jolson/ECON315/Whaples2123771.pdf|title=Where is There Consensus Among American Economic Historians? The Results of a Survey on Forty Propositions|journal=The Journal of Economic History|volume=55|issue=1|last1=Whaples|first1=Robert|year=1995|doi=10.1017/S0022050700040602|citeseerx=10.1.1.482.4975|s2cid=145691938 |access-date=February 18, 2022|archive-date=November 4, 2021|archive-url=https://web.archive.org/web/20211104183848/http://www.employees.csbsju.edu/jolson/econ315/whaples2123771.pdf|url-status=live}}</ref> ===Mainstream explanations=== Modern mainstream economists see the reasons in * A money supply reduction ([[Monetarists]]) and therefore a banking crisis, reduction of credit, and bankruptcies. * Insufficient demand from the private sector and insufficient fiscal spending ([[Keynesians]]). * Passage of the [[Smoot–Hawley Tariff Act]] exacerbated what otherwise might have been a more "standard" [[recession]] (both [[Monetarists]] and [[Keynesians]]).<ref name="ReferenceB" /> Insufficient spending, the money supply reduction, and debt on margin led to falling prices and further bankruptcies ([[Irving Fisher]]'s debt deflation). ====Monetarist view==== [[File:Great Depression monetary policy.png|thumb|The Great Depression in the U.S. from a monetary view. [[Real gross domestic product]] in 1996-Dollar (blue), [[price index]] (red), [[money supply]] M2 (green) and number of banks (grey). All data adjusted to 1929 = 100%.]] [[File:American union bank.gif|thumb|Crowd at New York's American Union Bank during a [[bank run]] early in the Great Depression]] The monetarist explanation was given by American economists [[Milton Friedman]] and [[Anna J. Schwartz]].<ref>''A Monetary History of the United States, 1857–1960''. Princeton University Press, Princeton, New Jersey, 1963.</ref> They argued that the Great Depression was caused by the banking crisis that caused one-third of all banks to vanish, a reduction of bank shareholder wealth and more importantly [[Contractionary monetary policy|monetary contraction]] of 35%, which they called "The [[Great Contraction]]". This caused a price drop of 33% ([[deflation]]).<ref>Randall E. Parker (2003), [https://books.google.com/books?id=Y-g4AgAAQBAJ&q=%22Pin+the+blame+squarely+on+the+Federal+Reserve%22&pg=PA11 ''Reflections on the Great Depression''] {{Webarchive|url=https://web.archive.org/web/20210818225154/https://books.google.com/books?id=Y-g4AgAAQBAJ&lpg=PR1&pg=PA11#v=snippet&q=%22Pin%20the%20blame%20squarely%20on%20the%20Federal%20Reserve%22 |date=August 18, 2021 }}, Edward Elgar Publishing, {{ISBN|978-1-84376-550-9}}, pp. 11–12</ref> By not lowering interest rates, by not increasing the monetary base and by not injecting liquidity into the banking system to prevent it from crumbling, the Federal Reserve passively watched the transformation of a normal recession into the Great Depression. Friedman and Schwartz argued that the downward turn in the economy, starting with the stock market crash, would merely have been an ordinary recession if the Federal Reserve had taken aggressive action.<ref>{{cite book|last1=Friedman|first1=Milton|url=https://books.google.com/books?id=-lCArZfazBkC&q=%22Regarding%20the%20Great%20Depression%20You're%20right%20We%20did%20it%22|title=The Great Contraction, 1929–1933|author2=Anna Jacobson Schwartz|publisher=Princeton University Press|year=2008|isbn=978-0691137940|edition=New|access-date=February 18, 2022|archive-date=January 16, 2020|archive-url=https://web.archive.org/web/20200116121531/https://books.google.com/books?id=-lCArZfazBkC&q=%22Regarding%20the%20Great%20Depression%20You%27re%20right%20We%20did%20it%22|url-status=live}}</ref><ref>{{cite book|last=Bernanke|first=Ben|url=https://books.google.com/books?id=c2OSWhLjzJkC&q=Schwartz&pg=PA6|title=Essays on the Great Depression|publisher=Princeton University Press|year=2000|isbn=0-691-01698-4|page=7|access-date=May 24, 2021|archive-date=December 24, 2021|archive-url=https://web.archive.org/web/20211224221348/https://books.google.com/books?id=c2OSWhLjzJkC&q=Schwartz&pg=PA6|url-status=live}}</ref> This view was endorsed in 2002 by [[Federal Reserve Board of Governors|Federal Reserve Governor]] [[Ben Bernanke]] in a speech honoring Friedman and Schwartz with this statement: {{blockquote|Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve. I would like to say to Milton and Anna: Regarding the Great Depression, you're right. We did it. We're very sorry. But thanks to you, we won't do it again.|Ben S. Bernanke<ref>Ben S. Bernanke (8 November 2002), [https://www.federalreserve.gov/boarddocs/speeches/2002/20021108/default.htm "FederalReserve.gov: Remarks by Governor Ben S. Bernanke"] {{Webarchive|url=https://web.archive.org/web/20200324160935/https://www.federalreserve.gov/BOARDDOCS/SPEECHES/2002/20021108/default.htm |date=March 24, 2020 }} Conference to Honor Milton Friedman, University of Chicago</ref><ref name=FriedmanSchwartz>{{cite book|last1=Friedman|first1=Milton|last2=Schwartz|first2=Anna|title=The Great Contraction, 1929–1933|url=https://books.google.com/books?id=-lCArZfazBkC&q=%22Regarding%20the%20Great%20Depression%20You're%20right%20We%20did%20it%22|year=2008|publisher=Princeton University Press|page=247|isbn=978-0691137940|edition=New|access-date=February 18, 2022|archive-date=January 16, 2020|archive-url=https://web.archive.org/web/20200116121531/https://books.google.com/books?id=-lCArZfazBkC&q=%22Regarding%20the%20Great%20Depression%20You%27re%20right%20We%20did%20it%22|url-status=live}}</ref>}} The Federal Reserve allowed some large public bank failures – particularly that of the [[New York Bank of United States]] – which produced panic and widespread runs on local banks, and the Federal Reserve sat idly by while banks collapsed. Friedman and Schwartz argued that, if the Fed had provided emergency lending to these key banks, or simply bought [[government bond]]s on the [[open market]] to provide liquidity and increase the quantity of money after the key banks fell, all the rest of the banks would not have fallen after the large ones did, and the money supply would not have fallen as far and as fast as it did.<ref>{{cite journal|last=Krugman|first=Paul|date=February 15, 2007|title=Who Was Milton Friedman?|url=https://www.nybooks.com/articles/19857|journal=[[The New York Review of Books]]|volume=54 |issue=2 |archive-url=https://web.archive.org/web/20080410200144/https://www.nybooks.com/articles/19857|archive-date=April 10, 2008|access-date=May 22, 2008}}</ref> With significantly less money to go around, businesses could not get new loans and could not even get their old loans renewed, forcing many to stop investing. This interpretation blames the Federal Reserve for inaction, especially the [[Federal Reserve Bank of New York|New York branch]].<ref>{{cite book|author=G. Edward Griffin|url=https://archive.org/details/TheCreatureFromJekyllIslandByG.EdwardGriffin|title=The Creature from Jekyll Island: A Second Look at the Federal Reserve|year=1998|isbn=978-0-912986-39-5|edition=3d|page=[https://archive.org/details/TheCreatureFromJekyllIslandByG.EdwardGriffin/page/n261 503]|publisher=American Media }}</ref> One reason why the Federal Reserve did not act to limit the decline of the money supply was the [[gold standard]]. At that time, the amount of credit the Federal Reserve could issue was limited by the [[Federal Reserve Act]], which required 40% gold backing of Federal Reserve Notes issued. By the late 1920s, the Federal Reserve had almost hit the limit of allowable credit that could be backed by the gold in its possession. This credit was in the form of Federal Reserve demand notes.<ref name="text">Frank Freidel (1973), [[iarchive:franklindrooseve04fran|''Franklin D. Roosevelt: Launching the New Deal'']], ch. 19, Little, Brown & Co.</ref> A "promise of gold" is not as good as "gold in the hand", particularly when they only had enough gold to cover 40% of the Federal Reserve Notes outstanding. During the bank panics, a portion of those demand notes was redeemed for Federal Reserve gold. Since the Federal Reserve had hit its limit on allowable credit, any reduction in gold in its vaults had to be accompanied by a greater reduction in credit. On 5 April 1933, President Roosevelt signed [[Executive Order 6102]] making the private ownership of [[gold certificate]]s, coins and bullion illegal, reducing the pressure on Federal Reserve gold.<ref name="text" /> ====Keynesian view==== British economist [[John Maynard Keynes]] argued in ''[[The General Theory of Employment, Interest and Money]]'' that lower [[aggregate expenditure]]s in the economy contributed to a massive decline in income and to employment that was well below the average. In such a situation, the economy reached equilibrium at low levels of economic activity and high unemployment. Keynes's basic idea was simple: to keep people fully employed, governments have to run deficits when the economy is slowing, as the private sector would not invest enough to keep production at the normal level and bring the economy out of recession. Keynesian economists called on governments during times of [[Crisis (economic)|economic crisis]] to pick up the slack by increasing [[government spending]] or cutting taxes. As the Depression wore on, [[Franklin D. Roosevelt]] tried [[public works]], [[Agricultural subsidy|farm subsidies]], and other devices to restart the U.S. economy, but never completely gave up trying to balance the budget. According to the Keynesians, this improved the economy, but Roosevelt never spent enough to bring the economy out of recession until the start of [[World War II]].<ref>{{Cite journal| author-link=Lawrence Klein|first=Lawrence R.|last=Klein|title=The Keynesian Revolution|year=1947| pages=56–58, 169, 177–179|location=New York|publisher=Macmillan}}; {{Cite book|first=Theodore|last=Rosenof|title=Economics in the Long Run: New Deal Theorists and Their Legacies, 1933–1993|year=1997|location=Chapel Hill|publisher=University of North Carolina Press|isbn=0-8078-2315-5}}</ref> =====Debt deflation===== [[File:U.S. Public and Private Debt as a % of GDP.jpg|thumb]] [[Irving Fisher]] argued that the predominant factor leading to the Great Depression was a vicious circle of deflation and growing over-indebtedness.<ref name="Fisher33">{{cite journal|last=Fisher|first=Irving|s2cid=35564016|date= October 1933|title=The Debt-Deflation Theory of Great Depressions|journal=Econometrica|volume=1| pages=337–57|doi=10.2307/1907327|issue=4|publisher=The Econometric Society|jstor=1907327}}</ref> He outlined nine factors interacting with one another under conditions of debt and deflation to create the mechanics of boom to bust. The chain of events proceeded as follows: # Debt liquidation and distress selling # Contraction of the money supply as bank loans are paid off # A fall in the level of asset prices # A still greater fall in the net worth of businesses, precipitating bankruptcies # A fall in profits # A reduction in output, in trade and in employment # [[Pessimism]] and loss of confidence # Hoarding of money # A fall in nominal interest rates and a rise in deflation adjusted interest rates<ref name="Fisher33"/> During the Crash of 1929 preceding the Great Depression, margin requirements were only 10%.<ref name="Margin Requirements">{{cite journal|last=Fortune|first=Peter|date=September–October 2000|title=Margin Requirements, Margin Loans, and Margin Rates: Practice and Principles – analysis of history of margin credit regulations – Statistical Data Included|journal=New England Economic Review|url=https://findarticles.com/p/articles/mi_m3937/is_2000_Sept-Oct/ai_80855422/pg_5|archive-url=https://web.archive.org/web/20150811102239/http://findarticles.com/p/articles/mi_m3937/is_2000_Sept-Oct/ai_80855422/pg_5|url-status=dead|archive-date=August 11, 2015|access-date=February 18, 2022}}</ref> Brokerage firms, in other words, would lend $9 for every $1 an investor had deposited. When the market fell, brokers [[Margin call|called in these loans]], which could not be paid back.<ref name="lhf-30s">{{cite web|access-date=May 22, 2008|url=https://www.livinghistoryfarm.org/farminginthe30s/money_08.html|title=Bank Failures|publisher=Living History Farm|archive-url=http://webarchive.loc.gov/all/20090219185825/https://livinghistoryfarm.org/farminginthe30s/money_08.html|archive-date=February 19, 2009|url-status=dead}}</ref> Banks began to fail as debtors defaulted on debt and depositors attempted to withdraw their deposits {{Lang|fr|en masse}}, triggering multiple [[bank run]]s. Government guarantees and Federal Reserve banking regulations to prevent such panics were ineffective or not used. Bank failures led to the loss of billions of dollars in assets.<ref name="lhf-30s"/> Outstanding debts became heavier, because prices and incomes fell by 20–50% but the debts remained at the same dollar amount. After the panic of 1929 and during the first 10 months of 1930, 744 U.S. banks failed. (In all, 9,000 banks failed during the 1930s.) By April 1933, around $7 billion in deposits had been frozen in failed banks or those left unlicensed after the [[Emergency Banking Act|March Bank Holiday]].<ref>"Friedman and Schwartz, Monetary History of the United States", 352</ref> Bank failures snowballed as desperate bankers called in loans that borrowers did not have time or money to repay. With future profits looking poor, [[Investment|capital investment]] and construction slowed or completely ceased. In the face of bad loans and worsening future prospects, the surviving banks became even more conservative in their lending.<ref name="lhf-30s"/> Banks built up their capital reserves and made fewer loans, which intensified deflationary pressures. A [[Virtuous circle and vicious circle|vicious cycle]] developed and the downward spiral accelerated. The liquidation of debt could not keep up with the fall of prices that it caused. The mass effect of the stampede to liquidate increased the value of each dollar owed, relative to the value of declining asset holdings. The very effort of individuals to lessen their burden of debt effectively increased it. Paradoxically, the more the debtors paid, the more they owed.<ref name="Fisher33"/> This self-aggravating process turned a 1930 recession into a 1933 great depression. Fisher's debt-deflation theory initially lacked mainstream influence because of the counter-argument that debt-deflation represented no more than a redistribution from one group (debtors) to another (creditors). Pure re-distributions should have no significant macroeconomic effects. Building on both the monetary hypothesis of Milton Friedman and Anna Schwartz and the debt deflation hypothesis of Irving Fisher, [[Ben Bernanke]] developed an alternative way in which the financial crisis affected output. He builds on Fisher's argument that dramatic declines in the price level and nominal incomes lead to increasing real debt burdens, which in turn leads to debtor insolvency and consequently lowers [[aggregate demand]]; a further price level decline would then result in a debt deflationary spiral. According to Bernanke, a small decline in the price level simply reallocates wealth from debtors to creditors without doing damage to the economy. But when the deflation is severe, falling asset prices along with debtor bankruptcies lead to a decline in the nominal value of assets on bank balance sheets. Banks will react by tightening their credit conditions, which in turn leads to a [[credit crunch]] that seriously harms the economy. A credit crunch lowers investment and consumption, which results in declining aggregate demand and additionally contributes to the deflationary spiral.<ref>Randall E. Parker, ''Reflections on the Great Depression'', Edward Elgar Publishing, 2003, {{ISBN|978-1-84376-550-9}}, pp. 14–15</ref><ref name="Bernanke83">{{cite journal|last=Bernanke|first=Ben S|date=June 1983|title=Non-Monetary Effects of the Financial Crisis in the Propagation of the Great Depression|journal=The American Economic Review|publisher=The American Economic Association|volume=73|issue=3|pages=257–276|jstor=1808111|url=https://faculty.arts.ubc.ca/dpaterson/econ532/10twenties/bernanke.pdf|access-date=February 22, 2021|archive-date=November 18, 2017|archive-url=https://web.archive.org/web/20171118070151/https://faculty.arts.ubc.ca/dpaterson/econ532/10twenties/bernanke.pdf|url-status=dead}}</ref><ref name="Mishkin78">{{cite journal|doi=10.1017/S0022050700087167|last=Mishkin|first= Fredric|date=December 1978|title=The Household Balance and the Great Depression|journal=Journal of Economic History|volume=38|issue=4|pages=918–937|s2cid=155049545 }}</ref> =====Expectations hypothesis===== Since economic mainstream turned to the [[new neoclassical synthesis]], expectations are a central element of macroeconomic models. According to [[Peter Temin]], Barry Wigmore, Gauti B. Eggertsson and [[Christina Romer]], the key to recovery and to ending the Great Depression was brought about by a successful management of public expectations. The thesis is based on the observation that after years of deflation and a very severe recession important economic indicators turned positive in March 1933 when [[Franklin D. Roosevelt]] took office. Consumer prices turned from deflation to a mild inflation, industrial production bottomed out in March 1933, and investment doubled in 1933 with a turnaround in March 1933. There were no monetary forces to explain that turnaround. Money supply was still falling and short-term interest rates remained close to zero. Before March 1933, people expected further deflation and a recession so that even interest rates at zero did not stimulate investment. But when Roosevelt announced major regime changes, people began to expect inflation and an economic expansion. With these positive expectations, interest rates at zero began to stimulate investment just as they were expected to do. Roosevelt's fiscal and monetary policy regime change helped make his policy objectives credible. The expectation of higher future income and higher future inflation stimulated demand and investment. The analysis suggests that the elimination of the policy dogmas of the gold standard, a balanced budget in times of crisis and small government led endogenously to a large shift in expectation that accounts for about 70–80% of the recovery of output and prices from 1933 to 1937. If the regime change had not happened and the Hoover policy had continued, the economy would have continued its free fall in 1933, and output would have been 30% lower in 1937 than in 1933.<ref>Gauti B. Eggertsson, [https://www.aeaweb.org/articles.php?doi=10.1257/aer.98.4.1476 ''Great Expectations and the End of the Depression''] {{Webarchive|url=https://web.archive.org/web/20160125070317/https://www.aeaweb.org/articles.php?doi=10.1257%2Faer.98.4.1476 |date=January 25, 2016 }}, American Economic Review 2008, 98:4, 1476–1516</ref><ref>Christina Romer, [https://www.nytimes.com/2012/10/21/business/how-the-fiscal-stimulus-helped-and-could-have-done-more.html "The Fiscal Stimulus, Flawed but Valuable"] {{Webarchive|url=https://web.archive.org/web/20211129132620/https://www.nytimes.com/2012/10/21/business/how-the-fiscal-stimulus-helped-and-could-have-done-more.html |date=November 29, 2021 }}, ''The New York Times'', October 20, 2012.</ref><ref>Peter Temin, ''Lessons from the Great Depression'', MIT Press, 1992, {{ISBN|978-0-262-26119-7}}, pp. 87–101.</ref> The [[recession of 1937–1938]], which slowed down economic recovery from the Great Depression, is explained by fears of the population that the moderate tightening of the monetary and fiscal policy in 1937 were first steps to a restoration of the pre-1933 policy regime.<ref>{{cite journal|jstor=29730131|at=p. 1480|title=Great Expectations and the End of the Depression|journal=The American Economic Review|volume=98|issue=4|last1=Eggertsson|first1=Gauti B.|year=2008|doi=10.1257/aer.98.4.1476|hdl=10419/60661|hdl-access=free}}</ref> ====Common position==== There is common consensus among economists today that the government and the central bank should work to keep the interconnected macroeconomic aggregates of [[gross domestic product]] and [[money supply]] on a stable growth path. When threatened by expectations of a depression, [[central bank]]s should expand liquidity in the banking system and the government should cut taxes and accelerate spending in order to prevent a collapse in money supply and [[aggregate demand]].<ref name="nber.org">{{cite journal |first=J. Bradford |last=De Long |title='Liquidation' Cycles: Old Fashioned Real Business Cycle Theory and the Great Depression |journal=NBER Working Paper No. 3546 |date=December 1990 |page=1 |doi=10.3386/w3546 |doi-access=free }}</ref> At the beginning of the Great Depression, most economists believed in [[Say's law]] and the equilibrating powers of the market, and failed to understand the severity of the Depression. Outright leave-it-alone [[Liquidationism (economics)|liquidationism]] was a common position, and was universally held by [[Austrian School]] economists.<ref name="Randall E. Parker 2003, p. 9"/> The liquidationist position held that a depression worked to liquidate failed businesses and investments that had been made obsolete by technological development – releasing [[factors of production]] (capital and labor) to be redeployed in other more productive sectors of the dynamic economy. They argued that even if self-adjustment of the economy caused mass bankruptcies, it was still the best course.<ref name="Randall E. Parker 2003, p. 9" /> Economists like [[Barry Eichengreen]] and [[J. Bradford DeLong]] note that President [[Herbert 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.<ref name="Randall E. Parker 2003, p. 9">Randall E. Parker, ''Reflections on the Great Depression'', Elgar Publishing, 2003, {{ISBN|978-1-84376-335-2}}, p. 9</ref><ref name="WhiteLawrence">{{cite journal|first=Lawrence|last=White|title=Did Hayek and Robbins Deepen the Great Depression?|journal=Journal of Money, Credit and Banking|volume=40|issue=4|pages=751–768|year=2008|doi=10.1111/j.1538-4616.2008.00134.x|url=https://dergipark.org.tr/tr/pub/liberal/issue/48188/609854|access-date=November 7, 2019|archive-date=April 15, 2021|archive-url=https://web.archive.org/web/20210415095946/https://dergipark.org.tr/tr/pub/liberal/issue/48188/609854|url-status=live}}</ref><ref>{{cite journal |first=J. Bradford |last=De Long |title='Liquidation' Cycles: Old Fashioned Real Business Cycle Theory and the Great Depression |journal=NBER Working Paper No. 3546 |date=December 1990 |page=5 |doi=10.3386/w3546 |doi-access=free }}</ref> An increasingly common view among economic historians is that the adherence of many Federal Reserve policymakers to the liquidationist position led to disastrous consequences.<ref name="WhiteLawrence" /> Unlike what liquidationists expected, 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.<ref>{{cite journal |first=J. Bradford |last=De Long |title='Liquidation' Cycles: Old Fashioned Real Business Cycle Theory and the Great Depression |journal=NBER Working Paper No. 3546 |date=December 1990 |page=33 |doi=10.3386/w3546 |doi-access=free }}</ref> Milton Friedman called leave-it-alone liquidationism "dangerous nonsense".<ref name="nber.org" /> He wrote: {{blockquote|I think the Austrian business-cycle theory has done the world a great deal of harm. If you go back to the 1930s, which is a key point, here you had the Austrians sitting in London, Hayek and Lionel Robbins, and saying you just have to let the bottom drop out of the world. You've just got to let it cure itself. You can't do anything about it. You will only make it worse. ... I think by encouraging that kind of do-nothing policy both in Britain and in the United States, they did harm.<ref name="WhiteLawrence" />}} ===Heterodox theories=== ====Austrian School==== Two prominent theorists in the [[Austrian School]] on the Great Depression include Austrian economist [[Friedrich Hayek]] and American economist [[Murray Rothbard]], who wrote ''[[America's Great Depression]]'' (1963). In their view, much like the monetarists, the [[Federal Reserve System|Federal Reserve]] (created in 1913) shoulders much of the blame; however, unlike the [[Monetarism|Monetarists]], they argue that the key cause of the Depression was the expansion of the [[money supply]] in the 1920s which led to an unsustainable credit-driven boom.<ref name="America's Great Depression, pp. 159-163">Murray Rothbard, ''America's Great Depression'' (Ludwig von Mises Institute, 2000), pp. 159–163.</ref> In the Austrian view, it was this inflation of the money supply that led to an unsustainable boom in both asset prices (stocks and bonds) and [[capital goods]]. Therefore, by the time the Federal Reserve tightened in 1928 it was far too late to prevent an economic contraction.<ref name="America's Great Depression, pp. 159-163" /> In February 1929 [[Friedrich Hayek|Hayek]] published a paper predicting the Federal Reserve's actions would lead to a crisis starting in the [[Stock market|stock]] and [[Credit market|credit]] markets.<ref>Steele, G. R. (2001). ''Keynes and Hayek''. Routledge. p. 9. {{ISBN|978-0-415-25138-9}}.</ref> According to Rothbard, the government support for failed enterprises and efforts to keep wages above their market values actually prolonged the Depression.<ref>Rothbard, ''America's Great Depression'', pp. 19–21.</ref> Unlike [[Murray Rothbard|Rothbard]], after 1970 [[Friedrich Hayek|Hayek]] believed that the Federal Reserve had further contributed to the problems of the Depression by permitting the money supply to shrink during the earliest years of the Depression.<ref> For Hayek's view, see: * Diego Pizano, ''Conversations with Great Economists: Friedrich A. Hayek, John Hicks, Nicholas Kaldor, Leonid V. Kantorovich, Joan Robinson, Paul A.Samuelson, Jan Tinbergen'' (Jorge Pinto Books, 2009). For Rothbard's view, see: * Murray Rothbard, ''A History of Money and Banking in the United States'' (Ludwig von Mises Institute), pp. 293–294.</ref> However, during the Depression (in 1932<ref name=":1" /> and in 1934)<ref name=":1" /> Hayek had criticized both the [[Federal Reserve System|Federal Reserve]] and the [[Bank of England]] for not taking a more contractionary stance.<ref name=":1">[[John Cunningham Wood]], Robert D. Wood, ''Friedrich A. Hayek'', Taylor & Francis, 2004, {{ISBN|978-0-415-31057-4}}, p. 115</ref> [[Hans Sennholz]] argued that most [[Austrian business cycle theory|boom and busts]] that plagued the American economy, such as those in [[Panic of 1819|1819–20]], [[Depression of 1837|1839–1843]], [[Panic of 1857|1857–1860]], [[Long Depression|1873–1878]], [[Depression of 1893|1893–1897]], and [[Depression of 1920–21|1920–21]], were generated by government creating a boom through easy money and credit, which was soon followed by the inevitable bust.<ref>{{cite web|url=https://fee.org/articles/the-great-depression/|title=The Great Depression|access-date=October 23, 2016|work=[[Foundation for Economic Education]]|first=Hans|last=Sennholz|date=October 1, 1969|archive-date=December 24, 2021|archive-url=https://web.archive.org/web/20211224092014/https://fee.org/articles/the-great-depression/|url-status=live}}</ref> [[Ludwig von Mises]] wrote in the 1930s: "Credit expansion cannot increase the supply of real goods. It merely brings about a rearrangement. It diverts capital investment away from the course prescribed by the state of economic wealth and market conditions. It causes production to pursue paths which it would not follow unless the economy were to acquire an increase in material goods. As a result, the upswing lacks a solid base. It is not real prosperity. It is illusory prosperity. It did not develop from an increase in economic wealth, i.e. the accumulation of savings made available for productive investment. Rather, it arose because the credit expansion created the illusion of such an increase. Sooner or later, it must become apparent that this economic situation is built on sand."<ref>{{cite web|url=https://mises.org/library/causes-economic-crisis-and-other-essays-and-after-great-depression|title=The Causes of the Economic Crisis, and Other Essays Before and After the Great Depression|access-date=October 24, 2016|work=[[Ludwig von Mises Institute]]|first=Ludwig|last=Mises|date=August 18, 2014|archive-date=December 5, 2021|archive-url=https://web.archive.org/web/20211205164755/https://mises.org/library/causes-economic-crisis-and-other-essays-and-after-great-depression|url-status=live}}</ref><ref>{{cite web|url=https://www.businessinsider.com/buying-bad-debt-to-return-bank-solvency-2011-2?op=1|title=Buying Bad Debt to Return Bank Solvency|access-date=October 24, 2016|work=[[Business Insider]]|first=Bill|last=Bonner|date=February 25, 2011|archive-date=October 24, 2016|archive-url=https://web.archive.org/web/20161024214604/http://www.businessinsider.com/buying-bad-debt-to-return-bank-solvency-2011-2?op=1|url-status=live}}</ref> ==== Marxist ==== [[Marxism|Marxists]] generally argue that the Great Depression was the result of the inherent instability of the [[Capitalist mode of production (Marxist theory)|capitalist mode of production]].<ref>{{Cite book |last=Corey |first=Lewis |url=https://books.google.com/books?id=fAW8AAAAIAAJ |title=The Decline of American Capitalism |date=1934 |publisher=Covici Friede Publishers |isbn=978-0-405-04116-7 |language=en}}</ref> According to ''[[Forbes]]'', "The idea that capitalism caused the Great Depression was widely held among intellectuals and the general public for many decades."<ref>{{Cite web |last=Fleisher |first=Larry |date=2009-10-30 |title=The Great Depression And The Great Recession |url=https://www.forbes.com/2009/10/29/depression-recession-gdp-imf-milton-friedman-opinions-columnists-bruce-bartlett.html |access-date= |website=[[Forbes]] |language=en}}</ref> ====Inequality==== [[File:Tenantless farm Texas panhandle 1938.jpg|thumb|[[Mechanised agriculture|Power farming]] displaces tenants from the land in the western dry cotton area. [[Childress County, Texas]], 1938.]] Two economists of the 1920s, [[Waddill Catchings]] and [[William Trufant Foster]], popularized a theory that influenced many policy makers, including [[Herbert Hoover]], [[Henry A. Wallace]], [[Paul Douglas]], and [[Marriner Eccles]]. It held the economy produced more than it consumed, because the consumers did not have enough income. Thus the unequal [[distribution of wealth]] throughout the 1920s caused the Great Depression.<ref>{{Cite book|last=Joseph.|first=Dorfman|url=https://worldcat.org/oclc/71400420|title=The economic mind in American civilization.|date=1959|publisher=The Viking Press|oclc=71400420|access-date=February 18, 2022|archive-date=February 18, 2022|archive-url=https://web.archive.org/web/20220218125334/https://www.worldcat.org/title/economic-mind-in-american-civilization-vol-5-1918-1933/oclc/71400420|url-status=live}}</ref><ref name="Allgoewer">{{cite journal|last=Allgoewer|first=Elisabeth|date=May 2002|title=Underconsumption theories and Keynesian economics. Interpretations of the Great Depression|journal=Discussion Paper No. 2002–14|url=https://www.vwa.unisg.ch/RePEc/usg/dp2002/dp0214allgoewer_ganz.pdf|access-date=February 18, 2022|archive-date=March 4, 2016|archive-url=https://web.archive.org/web/20160304134117/http://www1.vwa.unisg.ch/RePEc/usg/dp2002/dp0214allgoewer_ganz.pdf|url-status=live}}</ref> According to this view, the root cause of the Great Depression was a global over-investment in heavy industry capacity compared to wages and earnings from independent businesses, such as farms. The proposed solution was for the government to pump money into the consumers' pockets. That is, it must redistribute purchasing power, maintaining the industrial base, and re-inflating prices and wages to force as much of the inflationary increase in purchasing power into [[consumer spending]]. The economy was overbuilt, and new factories were not needed. Foster and Catchings recommended<ref>{{Cite book|last1=Foster|first1=William Trufant|url=https://books.google.com/books?id=BDNBAAAAIAAJ|title=The Road to Plenty|last2=Catchings|first2=Waddill|date=1928|publisher=Houghton Mifflin|language=en|access-date=December 28, 2021|archive-date=February 18, 2022|archive-url=https://web.archive.org/web/20220218125332/https://books.google.com/books?id=BDNBAAAAIAAJ|url-status=live}}</ref> federal and state governments to start large construction projects, a program followed by Hoover and Roosevelt. ====Productivity shock==== {{blockquote|It cannot be emphasized too strongly that the [productivity, output, and employment] trends we are describing are long-time trends and were thoroughly evident before 1929. These trends are in nowise the result of the present depression, nor are they the result of the World War. On the contrary, the present depression is a collapse resulting from these long-term trends.|[[M. King Hubbert]]<ref>{{Cite journal |last1 = Hubbert |first1 = M. King |title = Man Hours and Distribution, Derived from ''Man Hours: A Declining Quantity'', Technocracy, Series A, No. 8, August 1936 |year = 1940 |url = https://www.scribd.com/doc/22289589/Man-Hours-and-Distribution-M-King-Hubbert |journal = |access-date = September 9, 2017 |archive-date = April 7, 2020 |archive-url = https://web.archive.org/web/20200407132524/https://www.scribd.com/doc/22289589/Man-Hours-and-Distribution-M-King-Hubbert |url-status = live }}</ref>}} The first three decades of the 20th century saw economic output surge with [[electrification]], [[mass production]], and motorized farm machinery, and because of the rapid growth in productivity there was a lot of excess production capacity and the work week was being reduced. The dramatic rise in [[productivity]] of major industries in the U.S. and the effects of productivity on output, wages and the workweek are discussed by Spurgeon Bell in his book ''Productivity, Wages, and National Income'' (1940).<ref>{{Cite book |last1= Bell |first1=Spurgeon|title= Productivity, Wages and National Income, The Institute of Economics of the Brookings Institution |year= 1940}}</ref> ==Socio-economic effects== {{More citations needed section|date=May 2016}} [[File:Poor mother and children, Oklahoma, 1936 by Dorothea Lange.jpg|thumb|upright|An impoverished American family living in a shanty, 1936]] The majority of countries set up relief programs and most underwent some sort of political upheaval, pushing them to the right. Many of the countries in Europe and Latin America that were democracies saw them overthrown by some form of dictatorship or authoritarian rule, [[Nazi Germany#Nazi seizure of power|most famously in Germany]] in 1933. [[History of Newfoundland and Labrador#Political collapse|The Dominion of Newfoundland]] gave up democracy voluntarily. ===Australia=== {{Main|Great Depression in Australia}} Australia's dependence on agricultural and industrial exports meant it was one of the hardest-hit developed countries.<ref>Geoffrey Lawrence, ''Capitalism and the Countryside: The rural crisis in Australia'' (Pluto Press, 1987)</ref> Falling export demand and commodity prices placed massive downward pressures on wages. Unemployment reached a record high of 29% in 1932,<ref>[https://www.abs.gov.au/AUSSTATS/abs@.nsf/Previousproducts/1301.0Feature%20Article142001?opendocument&tabname=Summary&prodno=1301.0&issue=2001&num=&view= A Century of Change in the Australian Labour Market] {{Webarchive|url=https://web.archive.org/web/20211231105618/https://www.abs.gov.au/AUSSTATS/abs@.nsf/Previousproducts/1301.0Feature%20Article142001?opendocument&tabname=Summary&prodno=1301.0&issue=2001&num=&view= |date=December 31, 2021 }}, Australian Bureau of Statistics</ref> with incidents of [[civil unrest]] becoming common.<ref>John Birmingham (2000). Leviathan: The unauthorised biography of Sydney. Random House. {{ISBN|978-0-09-184203-1}}</ref> After 1932, an increase in wool and meat prices led to a gradual recovery.<ref>Judy Mackinolty, ed. ''The Wasted Years?: Australia's Great Depression'' (Allen & Unwin, 1981).</ref> ===Canada=== {{Main|Great Depression in Canada}} [[File:UnemployedMarch.jpg|thumb|upright|Unemployed men march in [[Toronto]], [[Ontario]], Canada.]] Harshly affected by both the global economic downturn and the [[Dust Bowl]], Canadian industrial production had by 1932 fallen to only 58% of its 1929 figure, the second-lowest level in the world after the United States, and well behind countries such as Britain, which fell to only 83% of the 1929 level. Total [[Measures of national income and output|national income]] fell to 56% of the 1929 level, again worse than any country apart from the United States. Unemployment reached 27% at the depth of the Depression in 1933.<ref>[https://www.canadianeconomy.gc.ca/English/economy/1929_39depression.html 1929–1939 – The Great Depression] {{webarchive|url=https://web.archive.org/web/20090127051620/https://canadianeconomy.gc.ca/english/economy/1929_39depression.html |date=January 27, 2009 }}, Source: Bank of Canada</ref> ===Chile=== {{Main|Great Depression in Chile}} The [[League of Nations]] labeled [[Chile]] the country hardest hit by the Great Depression because 80% of government revenue came from exports of copper and nitrates, which were in low demand. Chile initially felt the impact of the Great Depression in 1930, when GDP dropped 14%, mining income declined 27%, and export earnings fell 28%. By 1932, GDP had shrunk to less than half of what it had been in 1929, exacting a terrible toll in unemployment and business failures. Influenced profoundly by the Great Depression, many government leaders promoted the development of local industry in an effort to insulate the economy from future external shocks. After six years of government [[Austerity|austerity measures]], which succeeded in reestablishing Chile's creditworthiness, Chileans elected to office during the 1938–58 period a succession of center and left-of-center governments interested in promoting economic growth through government intervention. Prompted in part by the devastating [[1939 Chillán earthquake]], the [[Popular Front (Chile)|Popular Front]] government of [[Pedro Aguirre Cerda]] created the Production Development Corporation (Corporación de Fomento de la Producción, [[CORFO]]) to encourage with subsidies and direct investments an ambitious program of [[import substitution industrialization]]. Consequently, as in other Latin American countries, [[protectionism]] became an entrenched aspect of the Chilean economy. ===China=== {{Main|Nanjing Decade}} China was largely unaffected by the Depression, mainly by having stuck to the [[Silver standard]]. However, the U.S. silver purchase act of 1934 created an intolerable demand on China's silver coins, and so, in the end, the silver standard was officially abandoned in 1935 in favor of the four Chinese national banks'{{Which|date=September 2020}} "legal note" issues. China and the [[British colony of Hong Kong]], which followed suit in this regard in September 1935, would be the last to abandon the silver standard. In addition, the [[Nationalist Government]] also acted energetically to modernize the legal and penal systems, stabilize prices, amortize debts, reform the banking and currency systems, build railroads and highways, improve public health facilities, legislate against traffic in narcotics and augment industrial and agricultural production. On 3 November 1935, the government instituted the fiat currency (fapi) reform, immediately stabilizing prices and also raising revenues for the government. ===European African colonies=== The sharp fall in commodity prices, and the steep decline in exports, hurt the economies of the European colonies in Africa and Asia.<ref>Anthony Latham and John Heaton, ''The Depression and the Developing World, 1914–1939'' (1981).</ref><ref>{{cite journal|jstor=3601244|language=fr|title=Mutation de l'Impérialisme Colonial Français dans les Années 30|journal=African Economic History|issue=4|pages=103–152|last1=Coquery-Vidrovitch|first1=C.|year=1977|doi=10.2307/3601244}}</ref> The agricultural sector was especially hard hit. For example, [[sisal]] had recently become a major export crop in Kenya and Tanganyika. During the depression, it suffered severely from low prices and marketing problems that affected all colonial commodities in Africa. Sisal producers established centralized controls for the export of their fibre.<ref>{{cite journal | last1 = Westcott | first1 = Nicholas | year = 1984 | title = The East African sisal industry, 1929–1949: the marketing of a colonial commodity during depression and war | journal = Journal of African History | volume = 25 | issue = 4| pages = 445–461 | doi = 10.1017/s0021853700028486 | s2cid = 161203218 }}</ref> There was widespread unemployment and hardship among peasants, labourers, colonial auxiliaries, and artisans.<ref>R. Olufeni Ekundare, ''An Economic History of Nigeria 1860–1960'' (1973) [https://www.sahistory.org.za/archive/economic-history-nigeria-1860-1960-r-olufeni-ekundare online] {{Webarchive|url=https://web.archive.org/web/20211231120210/https://www.sahistory.org.za/archive/economic-history-nigeria-1860-1960-r-olufeni-ekundare |date=December 31, 2021 }} pp. 104–226.</ref> The budgets of colonial governments were cut, which forced the reduction in ongoing infrastructure projects, such as the building and upgrading of roads, ports and communications.<ref>{{cite journal | last1 = Olubomehin | first1 = O.O. | year = 2002 | title = Road Transportation and the Economy of South-Western Nigeria, 1920–1939 | journal = Lagos Historical Review | volume = 2 | pages = 106–121 }}</ref> The budget cuts delayed the schedule for creating systems of higher education.<ref>{{cite journal | last1 = Lungu | first1 = Gatian F. | year = 1993 | title = Educational Policy-Making in Colonial Zambia: The Case of Higher Education for Africans from 1924 to 1964 | journal = The Journal of Negro History | volume = 78 | issue = 4| pages = 207–232 | doi = 10.2307/2717416 | jstor = 2717416 | s2cid = 149538992 }}</ref> The depression severely hurt the export-based [[Belgian Congo]] economy because of the drop in international demand for raw materials and for agricultural products. For example, the price of peanuts fell from 125 to 25 centimes. In some areas, as in the [[Katanga Province|Katanga]] mining region, employment declined by 70%. In the country as a whole, the wage labour force decreased by 72,000 and many men returned to their villages. In Leopoldville, the population decreased by 33%, because of this labour migration.<ref>R. Anstey, ''King Leopold's Legacy: The Congo under Belgian Rule 1908–1960'' (1966), p. 109.</ref> Political protests were not common. However, there was a growing demand that the paternalistic claims be honored by colonial governments to respond vigorously. The theme was that economic reforms were more urgently needed than political reforms.<ref>{{cite journal | last1 = Ochonu | first1 = Moses | year = 2009 | title = Critical convergence: the Great Depression and the meshing of Nigerian and British anti-colonial polemic | journal = Canadian Journal of African Studies | volume = 43 | issue = 2| pages = 245–281 | doi = 10.1080/00083968.2010.9707572 | s2cid = 142695035 }}</ref> French West Africa launched an extensive program of educational reform in which "rural schools" designed to modernize agriculture would stem the flow of under-employed farm workers to cities where unemployment was high. Students were trained in traditional arts, crafts, and farming techniques and were then expected to return to their own villages and towns.<ref>{{cite journal | last1 = Gamble | first1 = Harry | year = 2009 | title = Les paysans de l'empire: écoles rurales et imaginaire colonial en Afrique occidentale française dans les années 1930 | journal = Cahiers d'Études Africaines | volume = 49 | issue = 3| pages = 775–803 | doi = 10.4000/etudesafricaines.15630 | doi-access = free }}</ref> ===France=== {{Main|Great Depression in France}} [[File:Agence Mondial 1932 - Soupe populaire offerte aux chômeurs en 1932 2.jpg|thumb|Soup kitchen for the unemployed in Paris, 1932]] The crisis affected France a bit later than other countries, hitting hard around 1931.<ref>{{Cite journal |jstor = 2601740|title = France and the Depression|journal = International Affairs |volume = 15|issue = 2|pages = 202–224|last1 = Laufenburger|first1 = Henry|year = 1936|doi = 10.2307/2601740}}</ref> While the 1920s grew at the very strong rate of 4.43% per year, the 1930s rate fell to only 0.63%.<ref>Jean-Pierre Dormois, ''The French Economy in the Twentieth Century'' (2004) p. 31</ref> The depression was relatively mild: unemployment peaked under 5%, the fall in production was at most 20% below the 1929 output; there was no banking crisis.<ref>{{cite journal|doi=10.1006/redy.2001.0143|title=The French Depression in the 1930s|journal=Review of Economic Dynamics|volume=5|pages=73–99|year=2002|last1=Beaudry|first1=Paul|last2=Portier|first2=Franck}}</ref> However, the depression had drastic effects on the local economy, and partly explains the [[February 6, 1934 riots]] and even more the formation of the [[Popular Front (France)|Popular Front]], led by [[Section française de l'Internationale ouvrière|SFIO socialist leader]] [[Léon Blum]], which won the elections in 1936. Ultra-nationalist groups also saw increased popularity, although democracy prevailed into [[World War II]]. France's relatively high degree of self-sufficiency meant the damage was considerably less than in neighbouring states like Germany. ===Germany=== {{Main|Weimar Republic}} [[File:Bundesarchiv Bild 102-11008, Hamburg, Arbeitslose Hafenarbeiter im Hafenviertel.jpg|thumb|Unemployed men in Hamburg, 1931]] The Great Depression hit Germany hard. The impact of the [[Wall Street Crash]] forced American banks to end the new loans that had been funding the repayments under the [[Dawes Plan]] and the [[Young Plan]]. The financial crisis escalated out of control in mid-1931, starting with the collapse of the [[Credit Anstalt]] in Vienna in May.<ref name="William Ashworth 1962 pp. 237-244"/> This put heavy pressure on Germany, which was already in political turmoil with the rise in violence of [[Nazism|national socialist]] and [[Communism|communist]] movements, as well as with investor nervousness at harsh government financial policies,<ref name="Isabel Schnabel 1931"/> investors withdrew their short-term money from Germany as confidence spiraled downward. The Reichsbank lost 150 million marks in the first week of June, 540 million in the second, and 150 million in two days, June 19–20. Collapse was at hand. U.S. President Herbert Hoover called for a moratorium on payment of war reparations. This angered Paris, which depended on a steady flow of German payments, but it slowed the crisis down, and the moratorium was agreed to in July 1931. An international conference in London later in July produced no agreements but on August 19 a standstill agreement froze Germany's foreign liabilities for six months. Germany received emergency funding from private banks in New York as well as the Bank of International Settlements and the Bank of England. The funding only slowed the process. Industrial failures began in Germany, a major bank closed in July and a two-day holiday for all German banks was declared. Business failures became more frequent in July, and spread to Romania and Hungary.<ref name="V. Hodson, 1938 pp. 64-76"/> In 1932, 90% of German reparation payments were cancelled (in the 1950s, Germany repaid all its missed reparations debts). Widespread unemployment reached 25% as every sector was hurt. The government did not increase government spending to deal with Germany's growing crisis, as they were afraid that a high-spending policy could lead to a return of the [[hyperinflation]] that had affected Germany in 1923. Germany's [[Weimar Republic]] was hit hard by the depression, as American loans to help rebuild the German economy now stopped.<ref>[https://www.english.uiuc.edu/maps/depression/about.htm About the Great Depression] {{Webarchive|url=https://web.archive.org/web/20081220090243/http://www.english.uiuc.edu/maps/depression/about.htm |date=December 20, 2008 }}, University of Illinois</ref> The unemployment rate reached nearly 30% in 1932.<ref name="pbs"/> [[File:The Great Depression German Medal 1932, the Devil operating a Screw Press against a Workman, obverse.jpg|thumb|left|The [[devil]] operating a screw press against a workman, Nazi propaganda [[medal]], obverse]] [[File:The Great Depression German Medal 1932, the Devil operating a Screw Press against a Workman, reverse.jpg|thumb|The reverse of this medal supporting the German election Nazi campaigns of 1932]] The German political landscape was dramatically altered, leading to [[Adolf Hitler's rise to power]]. The [[Nazi Party]] rose from being peripheral to winning 18.3% of the vote in the [[1930 German federal election|September 1930 election]] and the [[Communist Party of Germany|Communist Party]] also made gains, while moderate forces like the [[Social Democratic Party of Germany|Social Democratic Party]], the [[German Democratic Party|Democratic Party]] and the [[German People's Party|People's Party]] lost seats. The next two years were marked by increased street violence between Nazis and Communists, while governments under President [[Paul von Hindenburg]] increasingly relied on [[rule by decree]], bypassing the [[Reichstag (Weimar Republic)|Reichstag]].<ref>{{cite book | last = Bullock | first = Alan | author-link = Alan Bullock | title = Hitler: A Study in Tyranny | year = 1991 | orig-year = 1962 | publisher = Harper Perennial | location = New York; London | isbn = 978-1-56852-036-0 | title-link = Hitler: A Study in Tyranny | page=}}</ref> Hitler ran for the Presidency in 1932, and while he lost to the incumbent Hindenburg in the election, it marked a point during which both Nazi Party and the Communist parties rose in the years following the crash to altogether possess a Reichstag majority following the [[July 1932 German federal election|general election in July 1932]].<ref name="pbs">[https://www.pbs.org/wgbh/commandingheights/lo/countries/de/de_economic.html Germany – Economic] {{Webarchive|url=https://web.archive.org/web/20211231133720/https://www.pbs.org/wgbh/commandingheights/lo/countries/de/de_economic.html |date=December 31, 2021 }}, Public Broadcasting Service (PBS).</ref><ref>{{Cite web|url=https://www.historyplace.com/worldwar2/riseofhitler/runs.htm|title=The History Place – Rise of Hitler: Hitler Runs for President|website=www.historyplace.com|access-date=October 23, 2016|archive-date=November 3, 2016|archive-url=https://web.archive.org/web/20161103215044/http://www.historyplace.com/worldwar2/riseofhitler/runs.htm|url-status=live}}</ref> Although the Nazis lost seats in [[November 1932 German federal election|November 1932 election]], they remained the largest party, and Hitler was appointed as Chancellor the following January. The government formation deal was designed to give Hitler's conservative coalition partners many checks on his power, but over the next few months, the Nazis manoeuvred to consolidate a single-party dictatorship.<ref name="Kershaw98">{{cite book |author= Ian Kershaw |title= Hitler, 1889–1936: Hubris |url= https://books.google.com/books?id=nV-N10gyoFwC |year=1998 |publisher=W.W. Norton |isbn= 978-0-393-32035-0 |page=411}}</ref> [[File:Bundesarchiv Bild 119-11-19-12, Adolf Hitler bei Ortsgruppenfeier der NSDAP Rosenheim.jpg|thumb|[[Adolf Hitler]] speaking in 1935]] Hitler followed an [[autarky]] economic policy, creating a network of client states and economic allies in central Europe and Latin America. By cutting wages and taking control of labor unions, plus public works spending, unemployment fell significantly by 1935. Large-scale military spending played a major role in the recovery.<ref>[[Adam Tooze]], ''The Wages of Destruction: The Making and Breaking of the Nazi Economy'' (2007)</ref> The policies had the effect of driving up the cost of food imports and depleting foreign currency reserves, leading to economic impasse by 1936. Nazi Germany faced a choice of either reversing course or pressing ahead with rearmament and autarky. Hitler chose the latter route, which according to [[Ian Kershaw]] "could only be partially accomplished without territorial expansion" and therefore war.<ref>[[Richard Overy|R. J. Overy]], "Misjudging Hitler" pp. 93–115 from ''The Origins of the Second World War Reconsidered'' edited by Gordon Martel, Routledge: London, 1999 pp. 98–99.</ref><ref>Kershaw, Ian ''To Hell and Back: Europe 1914–1949'', Ch. 5</ref> ===Greece=== {{Main|Economic history of Greece and the Greek world}} The reverberations of the Great Depression hit Greece in 1932. The [[Bank of Greece]] tried to adopt deflationary policies to stave off the crises that were going on in other countries, but these largely failed. For a brief period, the drachma was pegged to the U.S. dollar, but this was unsustainable given the country's large trade deficit and the only long-term effects of this were Greece's foreign exchange reserves being almost totally wiped out in 1932. Remittances from abroad declined sharply and the value of the drachma began to plummet from 77 drachmas to the dollar in March 1931 to 111 drachmas to the dollar in April 1931. This was especially harmful to Greece as the country relied on imports from the UK, France, and the Middle East for many necessities. Greece went off the gold standard in April 1932 and declared a moratorium on all interest payments. The country also adopted protectionist policies such as import quotas, which several European countries did during the period. Protectionist policies coupled with a weak drachma, stifling imports, allowed the Greek industry to expand during the Great Depression. In 1939, the Greek industrial output was 179% that of 1928. These industries were for the most part "built on sand" as one report of the Bank of Greece put it, as without massive protection they would not have been able to survive. Despite the global depression, Greece managed to suffer comparatively little, averaging an average growth rate of 3.5% from 1932 to 1939. The dictatorial regime of [[Ioannis Metaxas]] took over the Greek government in 1936, and economic growth was strong in the years leading up to the Second World War. ===Iceland=== {{Main|Economic history of Iceland}} Icelandic post-World War I prosperity came to an end with the outbreak of the Great Depression. The Depression hit Iceland hard as the value of exports plummeted. The total value of Icelandic exports fell from 74 million kronur in 1929 to 48 million in 1932, and was not to rise again to the pre-1930 level until after 1939.<ref name=":3">{{Cite book|title=History of Iceland|last=Karlsson|first=Gunnar|year=2000|pages=308–12}}</ref> Government interference in the economy increased: "Imports were regulated, trade with foreign currency was monopolized by state-owned banks, and loan capital was largely distributed by state-regulated funds".<ref name=":3" /> Due to the outbreak of the [[Spanish Civil War]], which cut Iceland's exports of saltfish by half, the Depression lasted in Iceland until the outbreak of World War II (when prices for fish exports soared).<ref name=":3" /> ===India=== {{Main|Great Depression in India}} How much India was affected has been hotly debated. Historians have argued that the Great Depression slowed long-term industrial development.<ref>{{cite book|title=A Colonial Economy in the Great Depression, Madras (1929–1937)|first=K. A. |last=Manikumar|year=2003|ref=Manikumar}}</ref> Apart from two sectors—jute and coal—the economy was little affected. However, there were major negative impacts on the jute industry, as world demand fell and prices plunged.<ref>Samita Sen, "Labour, Organization and Gender: The Jute Industry in India in the 1930s", in Helmut Konrad and Wolfgang Maderthaner, eds. ''Routes Into the Abyss: Coping with Crises in the 1930s'' (2013) pp. 152–66.</ref> Otherwise, conditions were fairly stable. Local markets in agriculture and small-scale industry showed modest gains.<ref>{{Cite journal |jstor = 312643|title = The Great Depression and Indian Industry: Changing Interpretations and Changing Perceptions|journal = Modern Asian Studies|volume = 21|issue = 3|pages = 585–623|last1 = Simmons|first1 = Colin|year = 1987|doi = 10.1017/S0026749X00009215|s2cid = 145538790}}</ref> ===Ireland=== {{Main|Economic history of the Republic of Ireland}} Frank Barry and [[Mary E. Daly]] have argued that: :Ireland was a largely agrarian economy, trading almost exclusively with the UK, at the time of the Great Depression. Beef and dairy products comprised the bulk of exports, and Ireland fared well relative to many other commodity producers, particularly in the early years of the depression.<ref>Frank Barry and Mary F. Daly, "Concurrent Irish Perspectives on the Great Depression" (2010) [ online ]</ref><ref>Frank Barry and Mary E. Daly, "Irish Perceptions of the Great Depression" in Michael Psalidopoulos, ''The Great Depression in Europe: Economic Thought and Policy in a National Context'' (Athens: Alpha Bank, 2012) pp. 395–424.</ref><ref>See also B. Girvin, ''Between Two Worlds: Politics and Economy in Independent Ireland'' (Dublin: Gill and Macmillan, 1989).</ref><ref>Barry, Frank, and Mary E. Daly. "Irish Perceptions of the Great Depression" (No. iiisdp349. IIIS, 2011.) [https://www.tcd.ie/iiis/documents/discussion/pdfs/iiisdp349.pdf Online] {{Webarchive|url=https://web.archive.org/web/20150811154311/https://www.tcd.ie/iiis/documents/discussion/pdfs/iiisdp349.pdf |date=August 11, 2015 }}</ref> ===Italy=== {{Main|Economic history of Italy}} [[File:Bundesarchiv Bild 102-12509, Italien, Arbeitslose vor Fabrik.jpg|thumb|Unemployed outside a factory in Italy, October 1931]] [[File:Mussolini visiting Fiat, 1932.jpg|thumb|[[Benito Mussolini]] giving a speech at the [[Fiat]] [[Lingotto]] factory in Turin, 1932]] The Great Depression hit [[Economy of Italy under fascism#The Great Depression|Italy]] very hard.<ref>Vera Zamagni, ''The economic history of Italy 1860–1990'' (Oxford University Press, 1993)</ref> As industries came close to failure they were bought out by the banks in a largely illusionary bail-out—the assets used to fund the purchases were largely worthless. This led to a financial crisis peaking in 1932 and major government intervention. The [[Industrial Reconstruction Institute]] (IRI) was formed in January 1933 and took control of the bank-owned companies, suddenly giving Italy the largest state-owned industrial sector in Europe (excluding the USSR). IRI did rather well with its new responsibilities—restructuring, modernising and rationalising as much as it could. It was a significant factor in post-1945 development. But it took the Italian economy until 1935 to recover the manufacturing levels of 1930—a position that was only 60% better than that of 1913.<ref>Fabrizio Mattesini, and Beniamino Quintieri. "Italy and the Great Depression: An analysis of the Italian economy, 1929–1936." ''Explorations in Economic History'' (1997) 34#3 pp: 265–294.</ref><ref>Fabrizio Mattesini and Beniamino Quintieri. "Does a reduction in the length of the working week reduce unemployment? Some evidence from the Italian economy during the Great Depression." ''Explorations in Economic History'' (2006), 43#3, pp. 413–37.</ref> ===Japan=== The Great Depression did not strongly affect Japan. The Japanese economy shrank by 8% during 1929–31. Japan's Finance Minister [[Takahashi Korekiyo]] was the first to implement what have come to be identified as [[Keynesian economics|Keynesian]] economic policies: first, by large fiscal stimulus involving [[deficit spending]]; and second, by devaluing [[Yen|the currency]]. Takahashi used the Bank of Japan to sterilize the deficit spending and minimize resulting inflationary pressures. Econometric studies have identified the fiscal stimulus as especially effective.<ref>Myung Soo Cha, "Did Takahashi Korekiyo Rescue Japan from the Great Depression?", ''The Journal of Economic History'' 63, No. 1 (March 2003): 127–144.</ref> The devaluation of the currency had an immediate effect. Japanese textiles began to displace British textiles in export markets. The deficit spending proved to be most profound and went into the purchase of munitions for the armed forces. By 1933, Japan was already out of the depression. By 1934, Takahashi realized that the economy was in danger of overheating, and to avoid inflation, moved to reduce the deficit spending that went towards armaments and munitions. This resulted in a strong and swift negative reaction from nationalists, especially those in the army, culminating in his assassination in the course of the [[February 26 Incident]]. This had a [[chilling effect (term)|chilling effect]] on all civilian bureaucrats in the Japanese government. From 1934, the military's dominance of the government continued to grow. Instead of reducing deficit spending, the government introduced price controls and rationing schemes that reduced, but did not eliminate inflation, which remained a problem until the end of World War II. The deficit spending had a transformative effect on Japan. Japan's industrial production doubled during the 1930s. Further, in 1929 the list of the largest firms in Japan was dominated by light industries, especially textile companies (many of Japan's automakers, such as [[Toyota]], have their roots in the textile industry). By 1940 [[light industry]] had been displaced by heavy industry as the largest firms inside the Japanese economy.<ref>(For more on the Japanese economy in the 1930s see "MITI and the Japanese Miracle" by [[Chalmers Johnson]].)</ref> ===Latin America=== {{Main|Great Depression in Latin America}} Because of high levels of U.S. investment in Latin American economies, they were severely damaged by the Depression. Within the region, [[Chile]], [[Bolivia]] and [[Peru]] were particularly badly affected.<ref>Rosemary Thorp, ''Latin America in the 1930s: the role of the periphery in world crisis'' (Palgrave Macmillan, 2000).</ref> Before the 1929 crisis, links between the world economy and [[Latin America]]n economies had been established through American and British investment in Latin American exports to the world. As a result, Latin Americans export industries felt the depression quickly. World prices for commodities such as wheat, coffee and copper plunged. Exports from all of Latin America to the U.S. fell in value from $1.2 billion in 1929 to $335 million in 1933, rising to $660 million in 1940. But on the other hand, the depression led the area governments to develop new local industries and expand consumption and production. Following the example of the New Deal, governments in the area approved regulations and created or improved welfare institutions that helped millions of new industrial workers to achieve a better standard of living. === Middle East and North Africa === The Great Depression had severe impacts across the Middle East and North Africa, including economic decline which led to social unrest.<ref>{{Cite book|last=Anderson|first=Betty S.|url=https://www.worldcat.org/oclc/945376555|title=A history of the modern Middle East : rulers, rebels, and rogues|date=2016|isbn=978-0-8047-9875-4|location=Stanford, California|oclc=945376555|access-date=February 13, 2022|archive-date=February 18, 2022|archive-url=https://web.archive.org/web/20220218125354/https://www.worldcat.org/title/history-of-the-modern-middle-east-rulers-rebels-and-rogues/oclc/945376555|url-status=live}}</ref> ===Netherlands=== {{Main|Great Depression in the Netherlands}} [[File:Werklozen in de rij - Row of unemployed (5371990267).jpg|thumb|A line of unemployed people in Amsterdam, 1933]] From roughly 1931 to 1937, the [[Netherlands]] suffered a deep and exceptionally long depression. This depression was partly caused by the after-effects of the American stock-market crash of 1929, and partly by internal factors in the Netherlands. Government policy, especially the very late dropping of the Gold Standard, played a role in prolonging the depression. The Great Depression in the Netherlands led to some political instability and riots, and can be linked to the rise of the Dutch fascist political party [[Nationaal Socialistische Beweging|NSB]]. The depression in the Netherlands eased off somewhat at the end of 1936, when the government finally dropped the Gold Standard, but real economic stability did not return until after World War II.<ref>E. H. Kossmann, ''The Low Countries: 1780–1940'' (1978).</ref> ===New Zealand=== {{Main|History of New Zealand#Great Depression}} [[Dominion of New Zealand|New Zealand]] was especially vulnerable to worldwide depression, as it relied almost entirely on agricultural exports to the United Kingdom for its economy. The drop in exports led to a lack of disposable income from the farmers, who were the mainstay of the local economy. Jobs disappeared and wages plummeted, leaving people desperate and charities unable to cope. Work relief schemes were the only government support available to the unemployed, the rate of which by the early 1930s was officially around 15%, but unofficially nearly twice that level (official figures excluded Māori and women). In 1932, riots occurred among the unemployed in three of the country's main cities ([[Auckland]], [[Dunedin]], and [[Wellington]]). Many were arrested or injured through the tough official handling of these riots by police and volunteer "special constables".<ref>"[https://www.tepapa.govt.nz/whatson/exhibitions/sliceofheaven/exhibition/SocialWelfare/Pages/Greatdepression.aspx Social Welfare and The State: Great Depression] {{Webarchive|url=https://web.archive.org/web/20160307070443/http://tepapa.govt.nz/whatson/exhibitions/sliceofheaven/exhibition/socialwelfare/pages/greatdepression.aspx |date=March 7, 2016 }}", [[Museum of New Zealand Te Papa Tongarewa]].</ref> === Poland === {{Main|Second Polish Republic#Economy}} Poland was affected by the Great Depression longer and stronger than other countries due to inadequate economic response of the government and the pre-existing economic circumstances of the country. At that time, Poland was under the authoritarian rule of [[Sanation|Sanacja]], whose leader, [[Józef Piłsudski]], was opposed to leaving the [[gold standard]] until his death in 1935. As a result, Poland was unable to perform a more active monetary and budget policy. Additionally, Poland was a relatively young country that emerged merely 10 years earlier after being partitioned between [[German Empire|German]], [[Russian Empire|Russian]] and the [[Austria-Hungary|Austro-Hungarian Empires]] for over a century. Prior to independence, the Russian part exported 91% of its exports to Russia proper, while the German part exported 68% to Germany proper. After independence, these markets were largely lost, as Russia transformed into [[Soviet Union|USSR]] that was mostly a closed economy, and Germany was in a tariff war with Poland throughout the 1920s.<ref>{{Cite web|date=November 3, 2018|title=II RP była gospodarczą porażką. Mity na jej temat są bardzo szkodliwe [TOP 2018]|url=https://forsal.pl/artykuly/1330494,ii-rp-byla-gospodarcza-porazka-mity-na-jej-temat-sa-bardzo-szkodliwe.html|access-date=July 29, 2021|website=forsal.pl|language=pl|archive-date=October 19, 2021|archive-url=https://web.archive.org/web/20211019024334/https://forsal.pl/artykuly/1330494,ii-rp-byla-gospodarcza-porazka-mity-na-jej-temat-sa-bardzo-szkodliwe.html|url-status=live}}</ref> [[Industrial production]] fell significantly: in 1932 [[Anthracite|hard coal]] production was down 27% compared to 1928, [[steel]] production was down 61%, and [[iron ore]] production noted an 89% decrease.<ref name=":2">{{Cite web|title=Wielki kryzys gospodarczy w Polsce|url=https://histmag.org/Wielki-kryzys-gospodarczy-w-Polsce-9980|access-date=July 29, 2021|website=histmag.org|archive-date=July 29, 2021|archive-url=https://web.archive.org/web/20210729011419/https://histmag.org/Wielki-kryzys-gospodarczy-w-Polsce-9980|url-status=live}}</ref> On the other hand, electrotechnical, leather, and paper industries noted marginal increases in production output. Overall, industrial production decreased by 41%.<ref>{{Cite web|date=November 9, 2020|title=Wielki kryzys w Polsce. Zbankrutowało niemal 25% firm, a produkt krajowy spadł o ponad połowę|url=https://wielkahistoria.pl/wielki-kryzys-w-polsce-zbankrutowalo-niemal-25-firm-a-produkt-krajowy-spadl-o-ponad-polowe/|access-date=July 29, 2021|website=WielkaHistoria|language=pl-PL|archive-date=July 29, 2021|archive-url=https://web.archive.org/web/20210729012308/https://wielkahistoria.pl/wielki-kryzys-w-polsce-zbankrutowalo-niemal-25-firm-a-produkt-krajowy-spadl-o-ponad-polowe/|url-status=live}}</ref> A distinct feature of the Great Depression in Poland was the de-concentration of industry, as larger conglomerates were less flexible and paid their workers more than smaller ones. [[Unemployment|Unemployment rate]] rose significantly (up to 43%) while nominal [[wage]]s fell by 51% in 1933 and 56% in 1934, relative to 1928. However, real wages fell less due to the government's policy of decreasing cost of living, particularly food expenditures (food prices were down by 65% in 1935 compared to 1928 price levels). Material conditions deprivation led to strikes, some of them violent or violently pacified – like in [[Sanok]] ({{Interlanguage link|Marsz Głodnych w Sanoku|lt=March of the Hungry in Sanok|pl|Marsz Głodnych w Sanoku}} March 6, 1930), [[Lesko County|Lesko county]] ([[Lesko uprising]] 21 June – 9 July 1932) and [[Zawiercie]] ({{Interlanguage link|Krwawy piątek (1930)|lt=Bloody Friday (1930)|pl|Bloody Friday (1930)}} 18 April 1930). To adapt to the crisis, Polish government employed deflation methods such as high [[interest rate]]s, credit limits and budget [[austerity]] to keep a [[Fixed exchange rate system|fixed exchange rate]] with currencies tied to the gold standard. Only in late 1932 did the government effect a plan to fight the economic crisis.<ref>{{Cite web|title=140 lat temu urodził się Bolesław Wieniawa-Długoszowski|url=https://dzieje.pl/wiadomosci/140-lat-temu-urodzil-sie-boleslaw-wieniawa-dlugoszowski|access-date=July 29, 2021|website=dzieje.pl|language=pl|archive-date=August 12, 2021|archive-url=https://web.archive.org/web/20210812060931/https://dzieje.pl/wiadomosci/140-lat-temu-urodzil-sie-boleslaw-wieniawa-dlugoszowski|url-status=live}}</ref> Part of the plan was mass [[public works]] scheme, employing up to 100,000 people in 1935.<ref name=":2" /> After Piłsudski's death, in 1936 the gold standard regime was relaxed, and launching the development of the [[Central Industrial Region (Poland)|Central Industrial Region]] kicked off the economy, to over 10% annual growth rate in the 1936–1938 period. ===Portugal=== {{Main|Economic history of Portugal}} Already under the rule of a dictatorial junta, the [[Ditadura Nacional]], Portugal suffered no turbulent political effects of the Depression, although [[António de Oliveira Salazar]], already appointed Minister of Finance in 1928 greatly expanded his powers and in 1932 rose to [[Prime Minister of Portugal]] to found the [[Estado Novo (Portugal)|Estado Novo]], an [[authoritarian]] [[corporatist]] dictatorship. With the budget balanced in 1929, the effects of the depression were relaxed through harsh measures towards [[budget balance]] and [[autarky]], causing social discontent but stability and, eventually, an impressive economic growth.<ref>José Cardozo, "The great depression and Portugal" in Michael Psalidopoulos, ed. (2012). ''The Great Depression in Europe: Economic Thought and Policy in a National Context'' Athens: Alpha Bank, {{ISBN|978-960-99793-6-8}}. pp. 361–94 [https://www.ics.ul.pt/rdonweb-docs/ICS_JLCardoso_Great_AI.pdf Online] {{Webarchive|url=https://web.archive.org/web/20170313092132/http://www.ics.ul.pt/rdonweb-docs/ICS_JLCardoso_Great_AI.pdf |date=March 13, 2017 }}</ref> ===Puerto Rico=== In the years immediately preceding the depression, negative developments in the island and world economies perpetuated an unsustainable cycle of subsistence for many Puerto Rican workers. The 1920s brought a dramatic drop in Puerto Rico's two primary exports, raw sugar and coffee, due to a devastating hurricane in 1928 and the plummeting demand from global markets in the latter half of the decade. 1930 unemployment on the island was roughly 36% and by 1933 Puerto Rico's per capita income dropped 30% (by comparison, unemployment in the United States in 1930 was approximately 8% reaching a height of 25% in 1933).<ref>{{Cite book|title=A New Deal for the Tropics|last=Rodriguez|first=Manuel|publisher=Markus Wiener|year=2011|location=Princeton|page=23}}</ref><ref>{{Cite web|url=https://herb.ashp.cuny.edu/items/show/1510|title=Graph of U.S. Unemployment Rate: 1930–1945|website=American Social History Project|access-date=April 19, 2017|archive-date=January 23, 2021|archive-url=https://web.archive.org/web/20210123225658/https://herb.ashp.cuny.edu/items/show/1510|url-status=live}}</ref> To provide relief and economic reform, the United States government and Puerto Rican politicians such as [[Carlos E. Chardón|Carlos Chardon]] and [[Luis Muñoz Marín]] created and administered first the Puerto Rico Emergency Relief Administration (PRERA) 1933 and then in 1935, the [[Puerto Rico Reconstruction Administration]] (PRRA).<ref>{{Cite book|title=Economic History of Puerto Rico|last=Dietz|first=James|publisher=Princeton University Press|year=1986|isbn=0-691-02248-8|location=Princeton|pages=154–55|url=https://books.google.com/books?id=MeI9DwAAQBAJ|access-date=February 4, 2018|archive-date=August 18, 2021|archive-url=https://web.archive.org/web/20210818032634/https://books.google.com/books?id=MeI9DwAAQBAJ|url-status=live}}</ref> ===Romania=== {{Main|Great Depression in Romania}} Romania was also affected by the Great Depression.<ref>{{cite journal|url=https://nbs.rs/export/sites/NBS_site/documents/publikacije/konferencije/seemhn_conf/SEEMHN_14_Rumunija.pdf|title=The National Bank of Romania during the Great Depression – 1929–1933|first1=Elisabeta|last1=Blejan|first2=Brîndușa|last2=Costache|first3=Adriana|last3=Aloman|publisher=[[National Bank of Serbia]]|journal=Fourth Conference of Southeast Europe Monetary History Network (SEEMHN)|issue=8|pages=1–34|year=2009|access-date=March 21, 2021|archive-date=November 19, 2021|archive-url=https://web.archive.org/web/20211119000002/https://www.nbs.rs/export/sites/NBS_site/documents/publikacije/konferencije/seemhn_conf/SEEMHN_14_Rumunija.pdf|url-status=live}}</ref><ref>{{cite journal|url=https://www.gredeg.cnrs.fr/working-papers/GREDEG-WP-2019-43.pdf|title=Romania's unsustainable stabilization: 1929–1933|first1=Raphaël|last1=Chiappini|first2=Dominique|last2=Torre|first3=Elise|last3=Tosi|journal=GREDEG Working Papers|publisher=Groupe de Recherche en Droit, Economie, Gestion|issue=2019–43|pages=1–32|year=2009|access-date=February 18, 2022|archive-date=July 8, 2021|archive-url=https://web.archive.org/web/20210708140527/http://www.gredeg.cnrs.fr/working-papers/GREDEG-WP-2019-43.pdf|url-status=live}}</ref> ===South Africa=== {{Main|Great Depression in South Africa}} As world trade slumped, demand for South African agricultural and mineral exports fell drastically. The [[Carnegie Commission of Investigation on the Poor White Question in South Africa|Carnegie Commission on Poor Whites]] had concluded in 1931 that nearly one-third of [[Afrikaner]]s lived as paupers. The social discomfort caused by the depression was a contributing factor in the 1933 split between the "gesuiwerde" (purified) and "smelter" (fusionist) factions within the [[National Party (South Africa)|National Party]] and the National Party's subsequent fusion with the [[South African Party]].<ref>Dan O'Meara, ''Volkskapitalisme: class, capital, and ideology in the development of Afrikaner nationalism, 1934–1948'' (Cambridge University Press, 1983).</ref><ref>[https://www.country-studies.com/south-africa/the-great-depression-and-the-1930s.html The Great Depression and the 1930S] {{Webarchive|url=https://web.archive.org/web/20220102205937/https://www.country-studies.com/south-africa/the-great-depression-and-the-1930s.html |date=January 2, 2022 }}, Federal Research Division of the Library of Congress.</ref> Unemployment programs were begun that focused primarily on the white population.<ref>{{cite journal | last1 = Minnaar | first1 = Anthony | year = 1994 | title = Unemployment and relief measures during the Great Depression (1929–1934) | journal = Kleio | volume = 26 | issue = 1| pages = 45–85 | doi = 10.1080/00232084.1994.10823193 }}</ref> ===Soviet Union=== The Soviet Union was the world's only [[socialist state]] with very little international trade. Its economy was not tied to the rest of the world and was mostly unaffected by the Great Depression.<ref>Robert William Davies, Mark Harrison, and Stephen G. Wheatcroft, eds. ''The economic transformation of the Soviet Union, 1913–1945'' (Cambridge University Press, 1994)</ref> At the time of the Depression, the Soviet economy was growing steadily, fuelled by intensive investment in heavy industry. The apparent economic success of the Soviet Union at a time when the capitalist world was in crisis led many Western intellectuals to view the Soviet system favorably. Jennifer Burns wrote: {{blockquote|As the Great Depression ground on and unemployment soared, intellectuals began unfavorably comparing their faltering capitalist economy to Russian Communism. Karl Marx had predicted that capitalism would fall under the weight of its own contradictions, and now with the economic crisis gripping the West, his predictions seem to be coming true. By contrast Russia seemed an emblematic modern nation, making the staggering leap from a feudal past to an industrial future with ease.<ref>Jennifer Burns (2009).[https://books.google.com/books?id=z6e9X6JxHpMC&pg=PA34 ''Goddess of the Market: Ayn Rand and the American Right''] {{Webarchive|url=https://web.archive.org/web/20210415123811/https://books.google.com/books?id=z6e9X6JxHpMC&pg=PA34 |date=April 15, 2021 }}, p. 34. Oxford University Press. {{ISBN|0-19-532487-0}}</ref>}} The Great Depression caused mass immigration to the Soviet Union, mostly from Finland and Germany. Soviet Russia was at first happy to help these immigrants settle, because they believed they were victims of capitalism who had come to help the Soviet cause. However, when the Soviet Union entered the war in 1941, most of these Germans and Finns were arrested and sent to Siberia, while their Russian-born children were placed in orphanages. Their fate remains unknown.<ref>{{cite web|url=https://www.genealogia.fi/emi/art/article237e.htm|title=Illegal Emigration to the U.S.S.R. During the Great Depression|website=www.genealogia.fi|access-date=September 19, 2016|archive-date=February 24, 2021|archive-url=https://web.archive.org/web/20210224141430/https://www.genealogia.fi/emi/art/article237e.htm|url-status=dead}}</ref> ===Spain=== {{Main|Economic history of Spain}} Spain had a relatively isolated economy, with high protective tariffs and was not one of the main countries affected by the Depression. The banking system held up well, as did agriculture.<ref>Gabriel Tortella and Jordi Palafox, "Banking and Industry in Spain 1918–1936", ''Journal of European Economic History'' (1984), 13#2 Special Issue, pp. 81–110.</ref> By far the most serious negative impact came after 1936 from the heavy destruction of infrastructure and manpower by the [[Spanish Civil War|civil war, 1936–39]]. Many talented workers were forced into permanent exile. By staying neutral in the Second World War, and selling to both sides{{clarify|date=March 2020}}, the economy avoided further disasters.<ref>R.J. Harrison, ''Economic History of Modern Spain'' (1978), pp. 129–49.</ref> ===Sweden=== {{Main|Economy of Sweden}} By the 1930s, Sweden had what America's ''Life magazine'' called in 1938 the "world's highest standard of living". Sweden was also the first country worldwide to recover completely from the Great Depression. Taking place amid a short-lived government and a less-than-a-decade old Swedish democracy, events such as those surrounding [[Ivar Kreuger]] (who eventually committed suicide) remain infamous in Swedish history. The [[Swedish Social Democratic Party|Social Democrats]] under [[Per Albin Hansson]] formed their first long-lived government in 1932 based on strong [[Interventionism (economics)|interventionist]] and [[welfare state]] policies, monopolizing the office of [[Prime Minister of Sweden|Prime Minister]] until 1976 with the sole and short-lived exception of [[Axel Pehrsson-Bramstorp]]'s "summer cabinet" in 1936. During forty years of hegemony, it was the most successful political party in the history of Western liberal democracy.<ref>[[Göran Therborn]], "A Unique Chapter in the History of Democracy: The Swedish Social Democrats", in K. Misgeld et al. (eds), ''Creating Social Democracy'', University Park, Penn State University Press, 1996.</ref> ===Thailand=== In Thailand, then known as the [[Rattanakosin Kingdom|Kingdom of Siam]], the Great Depression contributed to the end of the [[Prajadhipok#Last absolute monarch|absolute monarchy of King Rama VII]] in the [[Siamese revolution of 1932]].<ref>{{cite book |last=Handley |first=Paul M. |title=The King Never Smiles: A Biography of Thailand's Bhumibol Adulyadej |publisher=Yale University Press |year=2006 |location=New Haven and London|page=37 }}</ref> ===United Kingdom=== {{Main|Great Depression in the United Kingdom|Interwar Britain}} [[File:Bundesarchiv Bild 102-10246, England, Arbeitslose vor Gewerkschaftshaus.jpg|thumb|right|Unemployed people in front of a workhouse in London, 1930]] The World Depression broke at a time when the United Kingdom had still not fully recovered from the effects of the [[World War I|First World War]] more than a decade earlier. The country was driven off the [[gold standard]] in 1931. The world financial crisis began to overwhelm Britain in 1931; investors around the world started withdrawing their gold from London at the rate of £2.5 million per day.<ref name="David Williams 1963"/> Credits of £25 million each from the Bank of France and the Federal Reserve Bank of New York and an issue of £15 million fiduciary note slowed, but did not reverse the British crisis. The financial crisis now caused a major political crisis in Britain in August 1931. With deficits mounting, the bankers demanded a balanced budget; the divided cabinet of Prime Minister Ramsay MacDonald's Labour government agreed; it proposed to raise taxes, cut spending and most controversially, to cut unemployment benefits by 20%. The attack on welfare was totally unacceptable to the Labour movement. MacDonald wanted to resign, but King George V insisted he remain and form an all-party coalition "[[National Government (United Kingdom)|National Government]]". The Conservative and Liberals parties signed on, along with a small cadre of Labour, but the vast majority of Labour leaders denounced MacDonald as a traitor for leading the new government. Britain went off the gold standard, and suffered relatively less than other major countries in the Great Depression. In the 1931 British election, the Labour Party was virtually destroyed, leaving MacDonald as prime minister for a largely Conservative coalition.<ref>Charles Loch Mowat, ''Britain between the wars, 1918–1940'' (1955) pp. 386–412.</ref><ref name="John Oxborrow 1976 pp. 67-73"/> The effects on the northern industrial areas of Britain were immediate and devastating, as demand for traditional industrial products collapsed. By the end of 1930 unemployment had more than doubled from 1 million to 2.5 million (20% of the insured workforce), and exports had fallen in value by 50%. In 1933, 30% of [[Glasgow|Glaswegians]] were unemployed due to the severe decline in heavy industry. In some towns and cities in the north east, unemployment reached as high as 70% as shipbuilding fell by 90%.<ref>[https://www.thegreatdepression.co.uk/unemployment-during-the-great-depression/ Unemployment During The Great Depression] {{webarchive|url=https://web.archive.org/web/20090124124118/https://thegreatdepression.co.uk/unemployment-during-the-great-depression |date=January 24, 2009 }}, thegreatdepression.co.uk</ref> The [[National Hunger March, 1932|National Hunger March]] of September–October 1932 was the largest<ref>Cook, Chris and Bewes, Diccon; ''What Happened Where: A Guide To Places And Events In Twentieth-Century History'' p. 115; Routledge, 1997 {{ISBN|1-85728-533-6}}</ref> of a series of [[hunger marches]] in Britain in the 1920s and 1930s. About 200,000 unemployed men were sent to the work camps, which continued in operation until 1939.<ref>[https://news.bbc.co.uk/2/hi/uk_news/scotland/7842448.stm "Work camps that tackled Depression"] {{Webarchive|url=https://web.archive.org/web/20220106193754/http://news.bbc.co.uk/2/hi/uk_news/scotland/7842448.stm |date=January 6, 2022 }}, BBC News.</ref> In the less industrial [[English Midlands|Midlands]] and [[Southern England]], the effects were short-lived and the later 1930s were a prosperous time. Growth in modern manufacture of electrical goods and a boom in the motor car industry was helped by a growing southern population and an expanding [[middle class]]. Agriculture also saw a boom during this period.<ref name="Social Conditions in Britain 1918–1939">[[Stephen Constantine (historian)|Constantine, Stephen]] (1983), ''Social Conditions in Britain 1918–1939'', {{ISBN|0-416-36010-6}}</ref> ===United States=== {{Main|Great Depression in the United States|The New Deal}} [[File:Unemployed men queued outside a depression soup kitchen opened in Chicago by Al Capone, 02-1931 - NARA - 541927.jpg|thumb|Unemployed men standing in line outside a depression soup kitchen in Chicago, 1931]] Hoover's first measures to combat the depression were based on encouraging businesses not to reduce their workforce or cut wages but businesses had little choice: wages were reduced, workers were laid off, and investments postponed.<ref name="Peter Clemens 1954, p. 114">Peter Clemens, ''Prosperity, Depression and the New Deal: The USA 1890–1954'', Hodder Education, 4. Auflage, 2008, {{ISBN|978-0-340-96588-7}}, p. 114.</ref><ref>Charles R. Morris, ''A Rabble of Dead Money: The Great Crash and the Global Depression: 1929–1939'' (PublicAffairs, 2017), 389 pp. [https://www.nytimes.com/2017/04/21/books/review/rabble-of-dead-money-charles-r-morris-great-depression-wall-street.html online review] {{Webarchive|url=https://web.archive.org/web/20170424184720/https://www.nytimes.com/2017/04/21/books/review/rabble-of-dead-money-charles-r-morris-great-depression-wall-street.html |date=April 24, 2017 }}</ref> In June 1930, Congress approved the [[Smoot–Hawley Tariff Act]] which raised tariffs on thousands of imported items. The intent of the Act was to encourage the purchase of American-made products by increasing the cost of imported goods, while raising revenue for the federal government and protecting farmers. Most countries that traded with the U.S. increased tariffs on American-made goods in retaliation, reducing international trade, and worsening the Depression.<ref>[https://future.state.gov/when/timeline/1921_timeline/smoot_tariff.html "Smoot-Hawley Tariff"] {{webarchive|url=https://web.archive.org/web/20090312055958/https://future.state.gov/when/timeline/1921_timeline/smoot_tariff.html |date=March 12, 2009 }}, ''U.S. Department of State''.</ref> In 1931, Hoover urged bankers to set up the [[National Credit Corporation]]<ref>{{cite encyclopedia|url=https://eh.net/encyclopedia/article/butkiewicz.finance.corp.reconstruction |title=Reconstruction Finance Corporation|encyclopedia=EH.net Encyclopedia|archive-url=https://web.archive.org/web/20131029205418/https://eh.net/encyclopedia/article/butkiewicz.finance.corp.reconstruction |archive-date=October 29, 2013 }}</ref> so that big banks could help failing banks survive. But bankers were reluctant to invest in failing banks, and the National Credit Corporation did almost nothing to address the problem.<ref>Clemens, ''Prosperity, Depression and the New Deal'', 2008, p. 113.</ref> [[File:evictbonusarmy.jpg|thumb|left|Burning shacks on the Anacostia flats, Washington, D.C., put up by the [[Bonus Army]] (World War I veterans) after the marchers with their wives and children were driven out by the regular Army by order of [[Herbert Hoover|President Hoover]], 1932<ref>[https://www.nps.gov/archive/elro/glossary/great-depression.htm The Great Depression (1929–1939)], The Eleanor Roosevelt Papers. {{webarchive |url=https://web.archive.org/web/20081223191011/https://www.nps.gov/archive/elro/glossary/great-depression.htm |date=December 23, 2008 }}</ref>]] By 1932, unemployment had reached 23.6%, peaking in early 1933 at 25%.<ref>{{cite journal |last1= Swanson |first1= Joseph | last2 = Williamson |first2= Samuel |year= 1972 |title = Estimates of national product and income for the United States economy, 1919–1941 |journal= Explorations in Economic History |volume= 10 |pages= 53–73 |doi = 10.1016/0014-4983(72)90003-4 }}</ref> Those releasing from prison during this period had an especially difficult time finding employment given the stigma of their criminal records, which often led to recidivism out of economic desperation.<ref name="PDN2"/> Drought persisted in the agricultural heartland, businesses and families defaulted on record numbers of loans, and more than 5,000 banks had failed.<ref>[https://encarta.msn.com/encyclopedia_761584403/great_depression_in_the_united_states.html "Great Depression in the United States"] {{Webarchive|url=https://web.archive.org/web/20091028014002/http://encarta.msn.com/encyclopedia_761584403/Great_Depression_in_the_United_States.html |date=October 28, 2009 }}, ''Microsoft Encarta''. [https://web.archive.org/web/20091028014002/http://encarta.msn.com/encyclopedia_761584403/Great_Depression_in_the_United_States.html Archived] October 31, 2009.</ref> Hundreds of thousands of Americans found themselves homeless, and began congregating in [[shanty town]]s – dubbed "[[Hooverville]]s" – that began to appear across the country.<ref>Joyce Bryant, [https://www.yale.edu/ynhti/curriculum/units/1998/4/98.04.04.x.html "The Great Depression and New Deal"] {{Webarchive|url=https://web.archive.org/web/20160721191938/http://www.yale.edu/ynhti/curriculum/units/1998/4/98.04.04.x.html |date=July 21, 2016 }}, ''Yale-New Haven Teachers Institute''.</ref> In response, President Hoover and Congress approved the [[Federal Home Loan Bank Act]], to spur new home construction, and reduce foreclosures. The final attempt of the Hoover Administration to stimulate the economy was the passage of the [[Emergency Relief and Construction Act]] (ERA) which included funds for [[public works]] programs such as dams and the creation of the [[Reconstruction Finance Corporation]] (RFC) in 1932. The Reconstruction Finance Corporation was a Federal agency with the authority to lend up to $2 billion to rescue banks and restore confidence in financial institutions. But $2 billion was not enough to save all the banks, and [[bank run]]s and bank failures continued.<ref name="Peter Clemens 1954, p. 114"/> Quarter by quarter the economy went downhill, as prices, profits and employment fell, leading to the [[Realigning election|political realignment]] in 1932 that brought to power [[Franklin Delano Roosevelt]]. [[File:Dust Bowl - Dallas, South Dakota 1936.jpg|thumb|Buried machinery in a barn lot; [[South Dakota]], May 1936. The [[Dust Bowl]] on the Great Plains coincided with the Great Depression.<ref>[https://eh.net/encyclopedia/article/Cunfer.DustBowl The Dust Bowl], Geoff Cunfer, Southwest Minnesota State University. {{webarchive |url=https://web.archive.org/web/20081228070418/https://eh.net/encyclopedia/article/Cunfer.DustBowl |date=December 28, 2008 }}</ref>]] Shortly after President [[Franklin Delano Roosevelt]] was inaugurated in 1933, drought and erosion combined to cause the [[Dust Bowl]], shifting hundreds of thousands of [[displaced persons]] off their farms in the Midwest. From his inauguration onward, Roosevelt argued that restructuring of the economy would be needed to prevent another depression or avoid prolonging the current one. New Deal programs sought to stimulate [[demand]] and provide work and relief for the impoverished through increased government spending and the institution of financial reforms. During a "bank holiday" that lasted five days, the [[Emergency Banking Act]] was signed into law. It provided for a system of reopening sound banks under [[United States Department of Treasury|Treasury]] supervision, with federal loans available if needed. The [[Securities Act of 1933]] comprehensively regulated the securities industry. This was followed by the [[Securities Exchange Act of 1934]] which created the [[Securities and Exchange Commission]]. Although amended, key provisions of both Acts are still in force. Federal insurance of [[Deposit account|bank deposits]] was provided by the [[Federal Deposit Insurance Corporation|FDIC]], and the [[Glass–Steagall Act]]. The [[Agricultural Adjustment Act]] provided incentives to cut farm production in order to raise farming prices. The [[National Recovery Administration]] (NRA) made a number of sweeping changes to the American economy. It forced businesses to work with government to set price codes through the NRA to fight [[deflation]]ary "cut-throat competition" by the setting of minimum prices and [[Minimum wage|wages]], labor standards, and competitive conditions in all industries. It encouraged unions that would raise wages, to increase the [[purchasing power]] of the [[working class]]. The NRA [[Schechter v. United States|was deemed unconstitutional]] by the [[Supreme Court of the United States]] in 1935. [[File:Civilian Conservation Corps - NARA - 195832.jpg|thumb|left|[[Civilian Conservation Corps|CCC]] workers constructing drainage culvert, 1933. Over 3 million unemployed young men were taken out of the cities and placed into 2,600+ work camps managed by the CCC.<ref>{{cite web |url=https://www.nationalparkstraveler.com/2008/09/park-history-spirit-civilian-conservation-corps |title=National Park History: "The Spirit of the Civilian Conservation Corps" |publisher=Nationalparkstraveler.com |access-date=September 4, 2010 |archive-url=https://web.archive.org/web/20100905182850/https://www.nationalparkstraveler.com/2008/09/park-history-spirit-civilian-conservation-corps |archive-date=September 5, 2010 |url-status=dead }}</ref>]] These reforms, together with several other relief and recovery measures, are called the [[First New Deal]]. Economic stimulus was attempted through a new [[Alphabet agencies|alphabet soup of agencies]] set up in 1933 and 1934 and previously extant agencies such as the [[Reconstruction Finance Corporation]]. By 1935, the "[[Second New Deal]]" added [[Social Security (United States)|Social Security]] (which was later considerably extended through the [[Fair Deal]]), a jobs program for the unemployed (the [[Works Progress Administration]], WPA) and, through the [[National Labor Relations Board]], a strong stimulus to the growth of labor unions. In 1929, federal expenditures constituted only 3% of the [[Gross domestic product|GDP]]. The national debt as a proportion of GNP rose under Hoover from 20% to 40%. Roosevelt kept it at 40% until the war began, when it soared to 128%. By 1936, the main [[economic indicator]]s had regained the levels of the late 1920s, except for unemployment, which remained high at 11%, although this was considerably lower than the 25% unemployment rate seen in 1933. In the spring of 1937, American industrial production exceeded that of 1929 and remained level until June 1937. In June 1937, the Roosevelt administration cut spending and increased taxation in an attempt to balance the federal budget.<ref>Robert Goldston, ''The Great Depression'', Fawcett Publications, 1968, p. 228.</ref> The American economy then took a sharp downturn, lasting for 13 months through most of 1938. Industrial production fell almost 30 per cent within a few months and production of [[durable good]]s fell even faster. Unemployment jumped from 14.3% in 1937 to 19.0% in 1938, rising from 5 million to more than 12 million in early 1938.<ref>''Economic Fluctuations'', Maurice W. Lee, Chairman of Economics Dept., Washington State College, published by R.D. Irwin Inc, Homewood, Illinois, 1955, p. 236.</ref> Manufacturing output fell by 37% from the 1937 peak and was back to 1934 levels.<ref>''Business Cycles'', James Arthur Estey, Purdue University, Prentice-Hall, 1950, pp. 22–23 chart.</ref> [[File:Wpa1.JPG|thumb|The [[Works Progress Administration|WPA]] employed 2–3 million at unskilled labor.]] Producers reduced their expenditures on durable goods, and inventories declined, but personal income was only 15% lower than it had been at the peak in 1937. As unemployment rose, consumers' expenditures declined, leading to further cutbacks in production. By May 1938 retail sales began to increase, employment improved, and industrial production turned up after June 1938.<ref>Maurice W. Lee, 1955.</ref> After the recovery from the Recession of 1937–38, conservatives were able to form a bipartisan [[conservative coalition]] to stop further expansion of the New Deal and, when unemployment dropped to 2% in the early 1940s, they abolished WPA, CCC and the PWA relief programs. Social Security remained in place. Between 1933 and 1939, federal expenditure tripled, and Roosevelt's critics charged that he was turning America into a [[Socialism|socialist]] state.<ref>Schlesinger, Jr., Arthur M. ''The Coming of the New Deal: 1933–1935.'' Paperback ed. New York: Houghton Mifflin, 2003 [1958]. {{ISBN|0-618-34086-6}}; Schlesinger, Jr., Arthur M. ''The Politics of Upheaval: 1935–1936.'' Paperback ed. New York: Houghton Mifflin, 2003 [1960]. {{ISBN|0-618-34087-4}}</ref> The Great Depression was a main factor in the implementation of [[social democracy]] and [[planned economy|planned economies]] in European countries after World War II (see [[Marshall Plan]]). [[Keynesianism]] generally remained the most influential economic school in the United States and in parts of Europe until the periods between the 1970s and the 1980s, when [[Milton Friedman]] and other [[neoliberal]] economists formulated and propagated the newly created theories of [[neoliberalism]] and incorporated them into the [[Chicago School of Economics]] as an alternative approach to the study of economics. Neoliberalism went on to challenge the dominance of the Keynesian school of Economics in the mainstream academia and policy-making in the United States, having reached its peak in popularity in the election of the presidency of [[Ronald Reagan]] in the United States, and [[Margaret Thatcher]] in the [[United Kingdom]].<ref>[[Lanny Ebenstein]], ''Milton Friedman: A Biography'' (2007).</ref> ==Literature== {{Quote box|quote=And the great owners, who must lose their land in an upheaval, the great owners with access to history, with eyes to read history and to know the great fact: when property accumulates in too few hands it is taken away. And that companion fact: when a majority of the people are hungry and cold they will take by force what they need. And the little screaming fact that sounds through all history: repression works only to strengthen and knit the repressed.|width=40%|source=–John Steinbeck, ''The Grapes of Wrath''<ref>''[[The Grapes of Wrath]]'', by [[John Steinbeck]], Penguin, 2006, 0143039431, p. 238</ref>}} The Great Depression has been the subject of much writing, as authors have sought to evaluate an era that caused both financial and emotional trauma. Perhaps the most noteworthy and famous novel written on the subject is ''[[The Grapes of Wrath]]'', published in 1939 and written by [[John Steinbeck]], who was awarded the [[Pulitzer Prize]] for the work, and in 1962 was awarded the [[Nobel Prize]] for literature. The novel focuses on a poor family of sharecroppers who are forced from their home as drought, economic hardship, and changes in the [[Agriculture|agricultural industry]] occur during the Great Depression. Steinbeck's ''[[Of Mice and Men]]'' is another important novella about a journey during the Great Depression. Additionally, Harper Lee's ''[[To Kill a Mockingbird]]'' is set during the Great Depression. Margaret Atwood's Booker prize-winning ''[[The Blind Assassin]]'' is likewise set in the Great Depression, centering on a privileged socialite's love affair with a Marxist revolutionary. The era spurred the resurgence of social realism, practiced by many who started their writing careers on relief programs, especially the [[Federal Writers' Project]] in the U.S.<ref>David Taylor, ''Soul of a People: The WPA Writers' Project Uncovers Depression America'' (2009).</ref><ref>Jerre Mangione, ''The Dream and the Deal: The Federal Writers' Project, 1935–1943'' (1996)</ref><ref>Jerrold Hirsch, ''Portrait of America: A Cultural History of the Federal Writers' Project'' (2006)</ref><ref>Stacy I. Morgan, ''Rethinking Social Realism: African American art and literature, 1930–1953 '' (2004), p. 244.</ref> Nonfiction works from this time also capture important themes. The 1933 memoir ''Prison Days and Nights'' by [[Victor Folke Nelson]] provides insight into criminal justice ramifications of the Great Depression, especially in regard to patterns of recidivism due to lack of economic opportunity.<ref name="PDN2">''Prison Days and Nights'', by Victor F. Nelson (New York: Garden City Publishing Co., Inc., 1936)</ref> A number of works for younger audiences are also set during the Great Depression, among them the [[Kit Kittredge]] series of ''[[American Girl (book series)|American Girl]]'' books written by [[Valerie Tripp]] and illustrated by [[Walter Rane]], released to tie in with the dolls and playsets sold by the company. The stories, which take place during the early to mid 1930s in [[Cincinnati]], focuses on the changes brought by the Depression to the titular character's family and how the Kittredges dealt with it.<ref name="Communications2000">{{cite book|last=Harry|first=Lou|title=Cincinnati Magazine|url=https://books.google.com/books?id=2O0CAAAAMBAJ&pg=PA59|access-date=July 10, 2017|date=October 1, 2010|publisher=Emmis Communications|pages=59–63|archive-date=April 15, 2021|archive-url=https://web.archive.org/web/20210415123527/https://books.google.com/books?id=2O0CAAAAMBAJ&pg=PA59|url-status=live}}</ref> A theatrical adaptation of the series entitled ''[[Kit Kittredge: An American Girl]]'' was later released in 2008 to positive reviews.<ref name="Morency">{{cite book|last=Morency|first=Philip|title=On the Aisle, Volume 2: Film Reviews by Philip Morency|url=https://books.google.com/books?id=AGyM0Bhsr-QC&pg=PA133|publisher=Dorrance Publishing|isbn=978-1-4349-7709-0|pages=133–|access-date=August 22, 2017|archive-date=August 17, 2021|archive-url=https://web.archive.org/web/20210817050620/https://books.google.com/books?id=AGyM0Bhsr-QC&pg=PA133|url-status=live}}</ref><ref name="Pimpare2017">{{cite book|last=Pimpare|first=Stephen|title=Ghettos, Tramps, and Welfare Queens: Down and Out on the Silver Screen|url=https://books.google.com/books?id=SCrADgAAQBAJ&pg=PA216|access-date=July 10, 2017|year=2017|publisher=Oxford University Press|isbn=978-0-19-066072-7|pages=216–|archive-date=April 15, 2021|archive-url=https://web.archive.org/web/20210415123813/https://books.google.com/books?id=SCrADgAAQBAJ&pg=PA216|url-status=live}}</ref> Similarly, ''Christmas After All'', part of the ''[[Dear America]]'' series of books for older girls, take place in 1930s [[Indianapolis]]; while ''Kit Kittredge'' is told in a third-person viewpoint, ''Christmas After All'' is in the form of a fictional journal as told by the protagonist Minnie Swift as she recounts her experiences during the era, especially when her family takes in an orphan cousin from Texas.<ref name="Smith2006">{{cite book|last=Smith|first=Robert W.|title=Spotlight on America: The Great Depression|url=https://books.google.com/books?id=lZhrdFflrzEC|access-date=July 10, 2017|date=January 26, 2006|publisher=Teacher Created Resources|isbn=978-1-4206-3218-7|archive-date=April 15, 2021|archive-url=https://web.archive.org/web/20210415134347/https://books.google.com/books?id=lZhrdFflrzEC|url-status=live}}</ref> ==Naming== {{Further|Economic depression}} The term "The Great Depression" is most frequently attributed to British economist [[Lionel Robbins]], whose 1934 book ''The Great Depression'' is credited with formalizing the phrase,<ref name="hnn">{{cite web|url=https://hnn.us/articles/61931.html|title=When Did the Great Depression Receive Its Name? (And Who Named It?) – History News Network|website=hnn.us|access-date=February 18, 2022|archive-date=January 9, 2022|archive-url=https://web.archive.org/web/20220109204651/http://hnn.us/articles/61931.html|url-status=live}}</ref> though Hoover is widely credited with popularizing the term,<ref name="hnn"/><ref>William Manchester, ''The Glory and the Dream: A Narrative History of America, 1932–1972''.</ref> informally referring to the downturn as a depression, with such uses as "Economic depression cannot be cured by legislative action or executive pronouncement" (December 1930, Message to Congress), and "I need not recount to you that the world is passing through a great depression" (1931). [[File:Schwarzer Freitag Wien 1873.jpg|thumb|upright=1.2|Black Friday, 9 May 1873, Vienna Stock Exchange. The [[Panic of 1873]] and [[Long Depression]] followed.]] The term "[[Depression (economics)|depression]]" to refer to an economic downturn dates to the 19th century, when it was used by varied Americans and British politicians and economists. The first major American economic crisis, the [[Panic of 1819]], was described by then-president [[James Monroe]] as "a depression",<ref name="hnn"/> and the most recent economic crisis, the [[Depression of 1920–21]], had been referred to as a "depression" by then-president [[Calvin Coolidge]]. Financial crises were traditionally referred to as "panics", most recently the major [[Panic of 1907]], and the minor [[Panic of 1910–11]], though the 1929 crisis was called "The Crash", and the term "panic" has since fallen out of use. At the time of the Great Depression, the term "The Great Depression" was already used to refer to the period 1873–96 (in the United Kingdom), or more narrowly 1873–79 (in the United States), which has retroactively been renamed the [[Long Depression]].<ref>{{Cite journal|first=T.W.|last=Fletcher|title=The Great Depression of English Agriculture 1873–1896|journal=The Economic History Review|volume=13|issue=3|year=1961|pages= 417–32|doi=10.2307/2599512|publisher=Blackwell Publishing|jstor=2599512}}</ref> ===Other "great depressions"=== The [[Dissolution of the Soviet Union|collapse of the Soviet Union]], and the breakdown of economic ties which followed, led to a severe economic crisis and catastrophic fall in the [[Standard of living|standards of living]] in the 1990s in [[post-Soviet states]] and the former [[Eastern Bloc]],<ref>[http://news.bbc.co.uk/1/hi/business/966616.stm "Child poverty soars in eastern Europe"], BBC News, October 11, 2000.</ref><ref>{{cite news |title=The wild decade: how the 1990s laid the foundations for Vladimir Putin's Russia |url=https://theconversation.com/the-wild-decade-how-the-1990s-laid-the-foundations-for-vladimir-putins-russia-141098 |work=The Convervation |date=2 July 2020}}</ref> which was even worse than the Great Depression.<ref>See "What Can Transition Economies Learn from the First Ten Years? A New World Bank Report," in ''Transition Newsletter'' [http://worldbank.org/transitionnewsletter/janfeb2002 Worldbank.org] {{Webarchive|url=https://archive.today/20120530044004/http://worldbank.org/transitionnewsletter/janfeb2002 |date=May 30, 2012 }}, [http://www.k-a.kg/?nid=5&value=6 K-A.kg]</ref><ref name=Russia>[https://query.nytimes.com/gst/fullpage.html?res=9B03E4D91E3AF93BA35753C1A9669C8B63 Who Lost Russia?], New York Times, October 8, 2000.</ref> Even before Russia's [[1998 Russian financial crisis|financial crisis]] of 1998, Russia's GDP was half of what it had been in the early 1990s.<ref name=Russia/> ==Comparison with the Great Recession== {{Main|Comparisons between the Great Recession and the Great Depression}} The [[late-2000s recession|worldwide economic decline after 2008]] has been compared to the 1930s.<ref>Adam Tooze, ''Crashed: How iters a Decade of Financial Crises Changed the World'' (2018) p. 41.</ref><ref>{{Cite news|url=https://economix.blogs.nytimes.com/2009/03/11/great-recession-a-brief-etymology/|title='Great Recession': A Brief Etymology|work=[[The New York Times]]|date=March 11, 2009|first=Catherine|last=Rampell|access-date=March 9, 2017|archive-date=October 19, 2021|archive-url=https://web.archive.org/web/20211019025802/https://economix.blogs.nytimes.com/2009/03/11/great-recession-a-brief-etymology/|url-status=live}}</ref><ref>{{Cite magazine |url=https://www.time.com/time/nation/article/0,8599,1891527,00.html |archive-url=https://web.archive.org/web/20090417050440/https://www.time.com/time/nation/article/0,8599,1891527,00.html |url-status=dead |archive-date=April 17, 2009 |magazine=[[Time (magazine)|Time]] |date=April 15, 2009|title=The Great Recession: America Becomes Thrift Nation|first= Nancy |last=Gibbs }}</ref><ref>{{Cite news|url= https://krugman.blogs.nytimes.com/2009/03/20/the-great-recession-versus-the-great-depression/|title= The Great Recession versus the Great Depression|work= [[The New York Times]]|first= Paul|last= Krugman|author-link= Paul Krugman|date= March 20, 2009|access-date= February 7, 2017|archive-date= February 25, 2021|archive-url= https://web.archive.org/web/20210225054220/https://krugman.blogs.nytimes.com/2009/03/20/the-great-recession-versus-the-great-depression/|url-status= live}}</ref><ref>{{Cite news|url=https://www.wsj.com/articles/SB124874235091485463|work=[[The Wall Street Journal]]|date=July 28, 2009|first=Justin|last=Lahart|title=The Great Recession: A Downturn Sized Up|access-date=August 3, 2017|archive-date=April 15, 2021|archive-url=https://web.archive.org/web/20210415102158/https://www.wsj.com/articles/SB124874235091485463|url-status=live}}</ref> The [[causes of the Great Recession]] seem similar to the Great Depression, but significant differences exist. The then-chairman of the [[Federal Reserve]], [[Ben Bernanke]], had extensively studied the Great Depression as part of his doctoral work at MIT, and implemented policies to manipulate the money supply and interest rates in ways that were not done in the 1930s. Bernanke's policies will undoubtedly be analyzed and scrutinized in the years to come, as economists debate the wisdom of his choices. In 2011, one journalist contrasted the Great Depression of the 1930s as opposed to the [[late-2000s recession]].<ref>Rabinowitz, Marco (October 6, 2011). [https://money.msn.com/top-stocks/post.aspx?post=c72333da-0a10-4f49-8007-3c32f545fea5 "The Great Depression vs. the Great Recession] {{Webarchive|url=https://web.archive.org/web/20111017025810/https://money.msn.com/top-stocks/post.aspx?post=c72333da-0a10-4f49-8007-3c32f545fea5 |date=October 17, 2011 }}: A look at the value of the U.S. dollar in 1929 and 2008; what has changed and where that leaves us today". [[MSN Money]]. Benzinga.</ref> {{blockquote|<poem>If we contrast the 1930s with the Crash of 2008 where gold went through the roof, it is clear that the U.S. dollar on the gold standard was a completely different animal in comparison to the fiat free-floating U.S. dollar currency we have today. Both currencies in 1929 and 2008 were the U.S. dollar, but analogously it is as if one was a [[Saber-toothed tiger]] and the other is a [[Bengal tiger]]; they are two completely different animals. Where we have experienced inflation since the Crash of 2008, the situation was much different in the 1930s when deflation set in. Unlike the deflation of the early 1930s, the U.S. economy currently appears to be in a "[[liquidity trap]]", or a situation where monetary policy is unable to stimulate an economy back to health. In terms of the stock market, nearly three years after the 1929 crash, the [[Dow Jones Industrial Average|DJIA]] dropped 8.4% on 12 August 1932. Where we have experienced great volatility with large intraday swings in the past two months, in 2011, we have not experienced any record-shattering daily percentage drops to the tune of the 1930s. Where many of us may have that '30s feeling, in light of the DJIA, the CPI, and the national unemployment rate, we are simply not living in the '30s. Some individuals may feel as if we are living in a depression, but for many others the current [[financial crisis of 2007–2008|global financial crisis]] simply does not feel like a depression akin to the 1930s.</poem>}} 1928 and 1929 were the times in the 20th century that the [[wealth gap]] reached such skewed extremes;<ref>Evans-Pritchard, Ambrose (September 14, 2010). [https://web.archive.org/web/20100915140526/https://www.telegraph.co.uk/finance/financetopics/financialcrisis/8000561/IMF-fears-social-explosion-from-world-jobs-crisis.html "IMF Fears 'Social Explosion' From World Jobs Crisis"]. ''[[The Daily Telegraph]]'' (London). "America and Europe face the worst jobs crisis since the 1930s and risk 'an explosion of social unrest' unless they tread carefully, the International Monetary Fund has warned."</ref> half the unemployed had been out of work for over six months, something that was not repeated until the late-2000s recession. 2007 and 2008 eventually saw the world reach new levels of wealth gap inequality that rivalled the years of 1928 and 1929. ==See also== {{portal|Economy|1920s|1930s}} {{div col}} * [[Causes of the Great Depression]] * [[Cities in the Great Depression]] * [[Entertainment during the Great Depression]] * [[List of Depression-era outlaws]] * [[Timeline of the Great Depression]] {{div col end}} ===General=== {{div col}} * [[Causes of World War II]] * [[Causes of World War I]] * [[Economic collapse]] * [[International relations (1919–1939)]] * [[Interwar France]] * [[Involuntary unemployment]] * [[List of economic crises]] {{div col end}} ==References== {{Reflist}} ==Further reading== ===Global=== * Brendon, Piers. ''The Dark Valley: A Panorama of the 1930s'' (2000) comprehensive global economic and political history; 816pp * Davis, Joseph S. ''The World Between the Wars, 1919–39: An Economist's View'' (1974) * [[John A. Garraty|Garraty, John A.]] ''The Great Depression: An Inquiry into the causes, course, and Consequences of the Worldwide Depression of the Nineteen-Thirties, as Seen by Contemporaries and in Light of History'' (1986) [https://archive.org/details/greatdepressioni00garr online] * Garside, W.R. ed. ''Capitalism in crisis: International responses to the Great Depression'' (1993), essays by experts * Grossman, Mark. ''Encyclopedia of the Interwar Years: From 1919 to 1939'' (2000). 400 pp. worldwide coverage * Hall Thomas E. and J. David Ferguson. ''The Great Depression: An International Disaster of Perverse Economic Policies'' (1998) * Hodson, H.V. ''Slump and Recovery, 1929–37: A Survey of World Economic Affairs'' (Oxford UP, 1938). [https://archive.org/details/in.ernet.dli.2015.264829/page/n3/mode/2up online] * Kehoe, Timothy J. and Edward C. Prescott. ''Great Depressions of the Twentieth Century'' (2007) * League Of Nations. ''World Economic Survey 1935–1936'' (1936) [https://archive.org/details/in.ernet.dli.2015.84656 online] * [[Goronwy Rees|Rees, Goronwy.]] ''The great slump: capitalism in crisis, 1929–33'' (1970) [https://archive.org/details/greatslumpcapita0000rees_j4u4 online], Marxist. * Rothermund, Dietmar. ''The Global Impact of the Great Depression'' (1996) * Woytinsky, Wladimir. ''The Social Consequences Of The Economic Depression'' (International Labour Office, 1936). Statistics of major economies; not online. ===Europe=== * Aldcroft, Derek H. "Economic Growth in Britain in the Inter-War Years: A Reassessment." Economic History Review, 20#2, 1967, pp. 311–26. [https://doi.org/10.2307/2592160 online] * Ambrosius, G. and W. Hibbard, ''A Social and Economic History of Twentieth-Century Europe'' (1989) * Broadberry, S. N. ''The British Economy between the Wars'' (Basil Blackwell 1986) * Feinstein. Charles H. ''The European Economy between the Wars'' (1997) * James, Harold. ''The German slump : politics and economics, 1924–1936'' (1986) [https://archive.org/details/germanslumppolit0000jame online] * Kaiser, David E. ''Economic diplomacy and the origins of the Second World War: Germany, Britain, France and Eastern Europe, 1930–1939'' (1980) * Konrad, Helmut and Wolfgang Maderthaner, eds. ''[https://books.google.com/books?id=cTPUAAAAQBAJ Routes Into the Abyss: Coping With Crises in the 1930s] {{Webarchive|url=https://web.archive.org/web/20200124020610/https://books.google.com/books?id=cTPUAAAAQBAJ |date=January 24, 2020 }}'' (Berghahn Books, 2013), 224 pp. Compares political crises in Germany, Italy, Austria, and Spain with those in Sweden, Japan, China, India, Turkey, Brazil, and the United States. * Psalidopoulos, Michael, ed. ''The Great Depression in Europe: Economic Thought and Policy in a National Context'' (Athens: Alpha Bank, 2012). {{ISBN|978-960-99793-6-8}}. Chapters by economic historians cover Finland, Sweden, Belgium, Austria, Italy, Greece, Turkey, Bulgaria, Yugoslavia, Romania, Spain, Portugal, and Ireland. [https://www.ics.ul.pt/rdonweb-docs/ICS_JLCardoso_Great_AI.pdf table of contents] {{Webarchive|url=https://web.archive.org/web/20170313092132/http://www.ics.ul.pt/rdonweb-docs/ICS_JLCardoso_Great_AI.pdf |date=March 13, 2017 }} * Tipton, F. and R. Aldrich, ''[[An Economic and Social History of Europe, 1890–1939]]'' (1987) ===United States and Canada=== * Dickstein, Morris. ''Dancing in the dark : a cultural history of the Great Depression'' (2009) [https://archive.org/details/dancingindarkcul0000dick online] * [https://archiveswest.orbiscascade.org/ark:80444/xv96795 Helping the Homeless Man: Activities and Facilities of the Central Registry for Homeless Single Men]. ca. 1933–1934. 18 photographic prints (1 box). At the [http://www.lib.washington.edu/specialcoll/laws Labor Archives of Washington, University of Washington Libraries Special Collections]. * [[John Kenneth Galbraith|Galbraith, John Kenneth]], ''The Great Crash, 1929'' (1954), popular [[iarchive:greatcrash19290000galb y8k2|online]] * Goldston, Robert, ''The Great Depression: The United States in the Thirties'' (1968) * McNeese, Tim, and Richard Jensen. ''The Great Depression 1929–1938'' (Discovering U.S. History) (2010) [https://www.amazon.com/Great-Depression-1929-1938-Discovering-History/dp/1604133570/ online], for middle schools. * Mitchell, Broadus. ''Depression Decade: From New Era through New Deal, 1929–1941'' (1947), 462 pp., thorough coverage of the U.S. economy [[iarchive:depressiondecade0000mitc|online]] * Reis, Ronald A. ''The Great Depression and the New Deal : America's economy in crisis'' (2011) for secondary schools. [[iarchive:greatdepressionn0000reis|online]] * Safarian, A. E. ''The Canadian economy in the Great Depression'' (2009) [[iarchive:canadianeconomyi00safa|online]] * [https://archiveswest.orbiscascade.org/ark:80444/xv43023 Washington Women’s Heritage Project Records: Ethel P. Storey Oral History Interview (13/20)]. 1985. 4 sound cassettes; papers. Storey discusses the Great Depression and hardships of early life, abortion, childbearing and motherhood. At the [http://www.lib.washington.edu/specialcoll/laws Labor Archives of Washington, University of Washington Libraries Special Collections]. * Young, William H. ''The Great Depression in America : a cultural encyclopedia'' (2007) [[iarchive:greatdepressioni0000youn|online]] ===Other areas=== * Brown, Ian. ''The Economies of Africa and Asia in the Inter-war Depression'' (1989) * Drinot, Paulo, and Alan Knight, eds. ''The Great Depression in Latin America'' (2014) [https://www.amazon.com/Great-Depression-Latin-America/dp/082235750X/ excerpt] * Latham, Anthony, and John Heaton, ''The Depression and the Developing World, 1914–1939'' (1981). * Shiroyama, Tomoko. ''China during the Great Depression : market, state, and the world economy, 1929–1937'' (2008) [https://archive.org/details/chinaduringgreat0000shir online] ===Focus on economic theory or econometrics=== * Bernanke, Ben. "The Macroeconomics of the Great Depression: A Comparative Approach" ''Journal of Money, Credit, and Banking'' (1995) 27#1 pp 1–28 [https://fraser.stlouisfed.org/scribd/?item_id=2399&filepath=/docs/meltzer/bermac95.pdf|jstor=2077848|doi=10.2307/2077848 online] * Eichengreen, Barry J. ''Hall of mirrors : the Great Depression, the great recession, and the uses-and misuses-of history'' (2015), leading economist compares economic decline after 1929 and after 2008. [https://archive.org/details/hallofmirrorsgre0000eich online] * Eichengreen, Barry. ''Golden Fetters: The gold standard and the Great Depression, 1919–1939.'' 1992. * Eichengreen, Barry, and Marc Flandreau. ''The Gold Standard in Theory and History'' (1997) * Friedman, Milton, and Anna Jacobson Schwartz. ''A Monetary History of the United States, 1867–1960'' (1963), monetarist interpretation (heavily statistical) * Glasner, David, ed. ''Business Cycles and Depressions'' (Routledge, 1997), 800 pp. [https://www.amazon.com/gp/product/0824009444/ Excerpt] * Grinin, L., [[Andrey Korotayev|Korotayev, A.]] and Tausch A. eds. ''[https://www.springer.com/de/book/9783319412603 Economic Cycles, Crises, and the Global Periphery]'' (2016). * [[Gottfried Haberler|Haberler, Gottfried.]] ''The World Economy, money, and the great depression 1919–1939'' (1976) * Kehoe, Timothy J. and Edward C. Prescott, eds. ''Great Depressions of the Twentieth Century'' (2007), essays by economists on the U.S., Britain, France, Germany, Italy and on tariffs; statistical * Kindleberger, Charles P. ''The World in Depression, 1929–1939'' (3rd ed. 2013) [https://archive.org/details/worldindepressio0000kind online] * Madsen, Jakob B. "Trade Barriers and the Collapse of World Trade during the Great Depression", ''Southern Economic Journal'', (2001) 67#4 pp. 848–68 [https://www.jstor.org/stable/1061574 online at JSTOR.] * [[Donald Markwell|Markwell, Donald]]. ''John Maynard Keynes and International Relations: Economic Paths to War and Peace'' (Oxford University Press, 2006). * Mundell, R.A. "A Reconsideration of the Twentieth Century", ''American Economic Review'' 90#3 (2000), pp. 327–40 [https://web.archive.org/web/20080909215904/https://www.robertmundell.net/NobelLecture/pdf/A%20RECONSIDERATION%20OF%20THE%20TWENTIETH%20CENTURY.pdf online version] * Richardson, H. W. "The Basis of Economic Recovery in the Nineteen-Thirties: A Review and a New Interpretation." ''Economic History Review,'' 15#2 (1962), pp. 344–63. [https://doi.org/10.2307/2599002 online]; focus on United Kingdom. * Romer, Christina D. "The Nation in Depression", ''Journal of Economic Perspectives'' (1993) 7#2 pp. 19–39 [https://www.jstor.org/stable/2138198 in JSTOR] {{Webarchive|url=https://web.archive.org/web/20160703181514/http://www.jstor.org/stable/2138198 |date=July 3, 2016 }}, statistical comparison of U.S. and other countries {{Commons category|Great Depression}} {{Wikiquote}} {{Portal bar|United States|Economics|1920s|World}} {{Great Depression}} {{New Deal}} {{United States–Commonwealth of Nations recessions}} {{United States topics}} {{economics}} {{Employment}} {{Authority control}} [[Category:Great Depression| ]] [[Category:1920s in economic history]] [[Category:1930s in economic history]] [[Category:Financial crises]] [[Category:World economy]] Summary: Please note that all contributions to Christianpedia may be edited, altered, or removed by other contributors. If you do not want your writing to be edited mercilessly, then do not submit it here. You are also promising us that you wrote this yourself, or copied it from a public domain or similar free resource (see Christianpedia:Copyrights for details). Do not submit copyrighted work without permission! Cancel Editing help (opens in new window) Templates used on this page: Great Depression (edit) Template:"' (edit) Template:About (edit) Template:Authority control (edit) Template:Blockquote (edit) Template:Blockquote/styles.css (edit) Template:Catalog lookup link (edit) Template:Citation (edit) Template:Citation needed (edit) Template:Cite book (edit) Template:Cite encyclopedia (edit) Template:Cite journal (edit) Template:Cite magazine (edit) Template:Cite news (edit) Template:Cite video (edit) Template:Cite web (edit) Template:Clarify (edit) Template:Comma separated entries (edit) Template:Commons category (edit) Template:DMCA (edit) Template:Dead link (edit) Template:Div col (edit) Template:Div col/styles.css (edit) Template:Div col end (edit) Template:Economics (edit) Template:Employment (edit) Template:Endash (edit) Template:Fix (edit) Template:Fix-span (edit) Template:Frac (edit) Template:Further (edit) Template:Great Depression (edit) Template:ISBN (edit) Template:Interlanguage link (edit) Template:Lang (edit) Template:Legend (edit) Template:Legend-line (edit) Template:Main (edit) Template:Main other (edit) Template:More citations needed section (edit) Template:Multiple image (edit) Template:Multiple image/styles.css (edit) Template:New Deal (edit) Template:Portal (edit) Template:Portal bar (edit) Template:Pp-vandalism (edit) Template:Quote box (edit) Template:Reflist (edit) Template:Reflist/styles.css (edit) Template:Short description (edit) Template:Sister project (edit) Template:Specify (edit) Template:United States topics (edit) Template:United States–Commonwealth of Nations recessions (edit) Template:Use American English (edit) Template:Use dmy dates (edit) Template:Webarchive (edit) Template:Which (edit) Template:Wikiquote (edit) Template:Yesno-no (edit) Template:Yesno-yes (edit) Module:Arguments (edit) Module:Catalog lookup link (edit) Module:Check for unknown parameters (edit) Module:Check isxn (edit) Module:Citation/CS1 (edit) Module:Citation/CS1/COinS (edit) Module:Citation/CS1/Configuration (edit) Module:Citation/CS1/Date validation (edit) Module:Citation/CS1/Identifiers (edit) Module:Citation/CS1/Utilities (edit) Module:Citation/CS1/Whitelist (edit) Module:Citation/CS1/styles.css (edit) Module:Format link (edit) Module:Hatnote (edit) Module:Hatnote/styles.css (edit) Module:Hatnote list (edit) Module:Labelled list hatnote (edit) Module:Multiple image (edit) Module:Portal (edit) Module:Portal/styles.css (edit) Module:Portal bar (view source) Module:Unsubst (edit) Module:Yesno (edit) Discuss this page