The study focuses on the great depression of the world in 1929. The purpose of the study is to explore world history and determine the world depression of 1929. The study will also discuss the impacts of the great depression around the world. The causes behind world depression will also be an area of discussion in this study. This ensures the significant effects of the world depression that brought a standstill to the world economy. However, the impacts of the world depression in 1929 were said to be the worst economic downturn followed by a financial panic among people.
Great depression occurs when the world undergoes an economic crisis. This also happens when the world runs out of adequate resources. The great depression gives rise to a collapse in the economic structure of the world. The impacts of the great depression appear to be alarming while retaining the world civilisation and providing adequate stocks. It lasts for a long period due to the uncertainty in balancing the economic growth of the world.
World depression of 1929
The Economic depression of the world started in 1929 and it deals with a deterioration in general prosperity and trade. The Great Depression of 1929 was worldwide starting with an agricultural recession followed by financial collapse and panic. It was the most severe and longest depression that was ever experienced by the western world, triggering the fundamental changes in macroeconomic policy and economic institutions around the globe. Although the depression originated in the USA, it caused a drastic decline in employment and a severe deflation in the economic growth of every country in the world. The cultural and social effects represented the bitter adversities faced by the Americans since the Civil War. The Great Depression was said to be the Wall Street Crash in the USA. However, at that time president of the USA, Hoover vainly tried to make an impression on the crisis.
The great depression of 1929 stood exemplary to show how intensely the global economy can deteriorate. The Gross Domestic Product (GDP) fell considerably by 15% as compared to the actual rate during the recession. The period was regarded as several economic contractions including the stock market crash and caused panic across the banking sectors that took place between 1930 and 1931.
The causes behind the great depression
The majority of economists and historians suggest that the stock market crash accounted for the Great Depression of 1929. It was marked by a steep decline in prices, industrial production, mass unemployment etc. The Great Depression began in the USA after a major fall in stock prices and became worldwide thereafter. It was started on October 29, 1929, and is known to be Black Tuesday in world history. However, the Great Depression resulted from the Wall Street Crash in 1929 and that was speculated for a long period. During this period, millions of people borrowed money to buy stocks and invested their savings.
Impacts of the great depression
The impacts of the Great Depression were intimidating as it caused unemployment among the people due to significant damage to the economy. However, the effects appear to be catastrophic in the USA where almost 15 million people were left high and dry due to dismissals from their jobs by 1933. The Great Depression turned averse to the money markets in other parts of the world. The impacts were a decline in exports in industrialised countries, internal consumption and factory closures. As there was a plunge in the international prices, the prices in India also slipped to a significant loss. The wheat prices in India fell by 50% between 1929 and 1934. However, the import and export prices were reduced by half. The peasants suffered more than any other urban dweller in the country.
It can be concluded that the Great Depression occurred due to the crash in the stock market and it started in the USA. It caused a severe decline in trade and general prosperity across the world. It has been found that the economic depression caused panic financially as it is regarded as the longest and most severe depression in the history of the world. However, the depression influenced the Indian markets where the farmers were affected due to the agricultural recession.