Great Depression

**Great Depression Overview and Causes:**
– The Great Depression lasted from 1929 to 1939.
– Worldwide GDP fell by an estimated 15% between 1929 and 1932.
– Unemployment in the U.S. rose to 23%, reaching 33% in some countries.
– Construction halted in many countries, impacting heavy industry-dependent cities.
– Primary sector industries suffered the most due to plummeting demand.
– The catalyst is often considered the devastating Wall Street Crash of 1929.
– Gradual price declines, overproduction, falling exports, and income inequality contributed to the crash.
– Frantic attempts by countries to shore up their economies worsened the collapse in global trade.
– The Smoot–Hawley Tariff Act exacerbated the depression by reducing international trade.

**Impact of the Great Depression:**
– The Dow Jones Industrial Average dropped from 381 to 198 after the 1929 crash.
– Consumers cut expenditures by 10% in the first half of 1930.
– Automobile sales declined, prices began to drop, and a deflationary spiral started in 1931.
– The U.S. economy’s decline affected other countries, pulling them down as well.
– The market lost 89% of its value from April 1930 to July 1932.
– Unemployment rate was about 15% in 1940, down from 25% in 1933.
– Roosevelt’s New Deal policies caused or accelerated economic expansion.
– Rollback of reflationary policies in late 1937 led to a recession.
– Banking Act of 1935 raised reserve requirements, causing monetary contraction.
– GDP returned to its upward trend in 1938.

**International Trade and Economic Policies During the Great Depression:**
– The Smoot–Hawley Tariff Act aimed to protect the American economy but backfired.
– Economists agree that the Act worsened the Great Depression.
– The Act caused a sharp decline in international trade, exacerbating the depression.
– Retaliatory tariffs in other countries further reduced international trade.
– Many blame the Act for seriously impacting countries dependent on foreign trade.
– Increase in duty rates on dutiable imports during the Depression.
– Decline in American exports and impact on farm commodities.
– Governments imposing tariffs, import quotas, and exchange controls.
– Variation in protectionist measures among countries.
– Relationship between a country’s economic downturn and its time on the gold standard.

**Gold Standard, Banking Crises, and Recovery:**
– Gold standard transmission mechanism of the Great Depression.
– Consensus on protectionist policies exacerbating the Great Depression.
– Major countries leaving the gold standard during the Depression.
– Connection between leaving the gold standard and economic recovery.
– Impact of gold standard suspension on worldwide recovery.
– Escalation of financial crisis starting with the collapse of Credit Anstalt.
– Pressure on Germany leading to investor withdrawals.
– U.S. President Hoover’s call for a moratorium on war reparations.
– Funding and agreements to address the German crisis.
– Impact of crisis on Britain and the formation of a National Government.
– Recovery from the Great Depression starting in most countries in 1933.
– U.S. recovery beginning in early 1933.
– U.S. taking over a decade to return to 1929 GNP.
– Overall course of the Depression reflected in per-capita GDP.
– Key events during the Depression period.

**Miscellaneous Factors and Recovery Strategies During the Great Depression:**
– Role of Women and Household Economics during the Great Depression.
– World War II and its impact on recovery from the Great Depression.
– Economic Factors and Recovery strategies.
– Household Strategies During the Depression.
– Causes of the Great Depression, including monetary factors and mainstream explanations.
– Debt deflation theory and its impact on the Depression.
– Expectations Hypothesis and its role in the recovery.
– Recession of 1937-1938 and its hindrance to the recovery progress.
– Common positions advocated by economists for stable growth and policy interventions during depressions.