Great Depression

Definition

The Great Depression was a severe worldwide economic downturn that began in 1929 and lasted through the late 1930s, marked by a dramatic decline in industrial output, widespread unemployment, and significant deflation. This period had profound implications for global poverty, as millions were plunged into economic despair, altering societal structures and prompting government interventions to mitigate its impact.

5 Must Know Facts For Your Next Test

1. The Great Depression began with the Stock Market Crash of 1929, leading to a significant drop in consumer spending and investment.
2. Unemployment rates soared during this time, reaching approximately 25% in the United States at the height of the crisis.
3. Global trade fell sharply due to protectionist policies and tariffs, further deepening economic woes in many countries.
4. Governments around the world were forced to intervene through various means, such as public works programs and financial regulations, to stabilize their economies.
5. The Great Depression had lasting effects on global poverty rates, increasing the number of people living in destitution and altering social safety nets.

Review Questions

• How did the Great Depression influence government policies related to poverty alleviation?
  • The Great Depression forced governments to rethink their approach to managing economic crises and addressing poverty. In response to the widespread suffering, many countries implemented policies aimed at job creation and economic relief, such as public works programs and social welfare initiatives. This shift led to a greater recognition of the need for government intervention in economic matters, establishing frameworks that would influence future policies related to poverty alleviation.
• Evaluate the impact of the Dust Bowl on both the agricultural sector and urban migration patterns during the Great Depression.
  • The Dust Bowl devastated agricultural production in the Great Plains, causing immense crop failures and loss of farmland. As farmers struggled to survive, many were forced to migrate westward to seek better opportunities, particularly in California. This mass migration altered urban demographics as thousands sought work in cities, creating new challenges for those regions while highlighting the interconnectedness of rural and urban economies during the Great Depression.
• Analyze how the global dimensions of the Great Depression contributed to an increase in international poverty levels and influenced future economic policies.
  • The global nature of the Great Depression exacerbated poverty levels worldwide as countries faced plummeting trade volumes and rising unemployment. The interconnected economies meant that financial crises in one nation quickly spread to others, creating a cycle of economic despair. In response to these challenges, many nations adopted protectionist measures that further isolated them from global markets. This experience laid groundwork for later international cooperation efforts aimed at preventing such widespread economic failure, ultimately influencing policies like Bretton Woods that sought stability in post-war economic frameworks.

Related terms

Stock Market Crash of 1929: A sudden and severe downturn in stock prices that occurred in October 1929, which is often considered the initial trigger of the Great Depression.

New Deal: A series of programs and policies implemented by U.S. President Franklin D. Roosevelt in response to the Great Depression aimed at economic recovery and social reform.

Dust Bowl: A severe drought during the 1930s that exacerbated agricultural hardships in the Great Plains of the U.S., leading to massive crop failures and further economic distress.