StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

Social and Cultural Effects of the Great Depression - Term Paper Example

Cite this document
Summary
The author of the paper "Social and Cultural Effects of the Great Depression" will begin with the statement that the great depression refers to the global economic breakdown that shook financial markets, especially in North America, Europe, and the rest of the world’s developed economies.
 …
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER94.1% of users find it useful
Social and Cultural Effects of the Great Depression
Read Text Preview

Extract of sample "Social and Cultural Effects of the Great Depression"

The great depression refers to the global economic break down that shook financial markets, especially in North America, Europe and the rest of world’s developed economies. The great Depression occurred in the period right before the 2ndworld war around 1929 and extended into the century up to about 1939; this period was characterized by severe financial repercussions that had long-standing effects on individual investors, banks and other financial institutions. The great depression has always been linked to the infamous calamitous crumple of New York stock market prices in 1929, a trend that continued steadily three years on.1 By the year 1932, stock market prices in the New York Stock exchange had declined to a meager 20% of their previous value in 1929. Many banks and businesses went under as a result, and this instigated the fall in the economy potential, as there was reduced spending, low demand, low production and high unemployment accordingly.2 Even though, the great depression had its origins in America, all the European nations were greatly hit as they were heavily relying on the US for financial loans; the US had emerged as a great credit in the post world war one period. The complex financial relationship between the European economies and the US was inevitably the reason why the great depression could not be contained in the US, but later spread to the rest of the European nations. Nations were thrown into panic mode, most of them adopting restrictive measures, especially concerning foreign trade as mitigation to salvage their local industries.3 Discussions on the great discussion have yielded important information on the delicate financial market relationships, and this is a key area of concern especially in the view of contemporary global economic ties. This topic is relevant to global economies as it provides vital lessons that could help mitigate the risks of a future global financial slump.4 This paper will focus on various aspects of the great depression including, but limited to its causes, its effects in America, and the rest of European economies that were hugely indebted to the US at the time. In as much as the great depression was sparked by the great slouch in the New York stock market prices, there were other underlying factors that have been attributed to it. These factors are specifically weaknesses and imbalances that existed in the American financial system, but they had long been ignored due to the rapid economic growth, and the resultant speculative optimism. The onset of the great depression revealed the faulty premises of the American financial system, and its failure of America’s political and financial institutions to manage the economy. Concerning the causes of the great depression, five factors have been top on the list, the fall in stock Market prices, failure of the banking system, a decline in the purchasing power, the American- Europe economic ties, and famine.5 Prior to fall in stock prices, banks had been lending out large sums of money to businesses and investors, even way beyond their capabilities; this gave rise to debt deflation. After the crash in prices, great losses were incurred by stock investors as the value of stocks had gone down drastically i.e. stocks lost over 90% of their value, and stockholders incurred losses amounting to over 40 billion dollars. Many banks could not recover their loans as many debtors defaulted in payments, and as a result, many people withdrew their deposits. Rapid measures of self-preservation were taken by the surviving banks and this included cutting down on loans, a desperate move that resulted to further limitations to the economy. Bank's restrictive measures to limit lending, coupled by loss of jobs and the resultant unemployment led to harsh times in the history of the US economy; there was low output and low demand of products and as such, many businesses suffered insolvency. About 11,000 banking institutions had collapsed by the year 1933, as they could not tolerate the harsh economic conditions of the day. Because of this, many people lost their savings and the banks could not insure any deposits that were made due to the many economic uncertainties of the time. The fears of hard economic times to come instigated the low purchasing power of the economy as households were forced to cut their spending in self-preservation.6 This was also factored by other factors such low disposable incomes due to the high unemployment that was prevalent at the time- as high as between 25- 30%.7 Lack of jobs meant there was no money to spend, and as a result, there was low demand for products and services, a factor that led to low production. In a bid to salvage the local industries, the US government took sterner actions that restricted international trade i.e. taxes were increased on importation of goods in order to promote locally manufactured goods.8 Other countries also reacted in the same manner by raising their tariffs in order to protect their local industries and businesses; this eventually led to the breakdown of international trade, and it did not solve the economic problems. Famine that struck the Mississippi valley can be considered, as an indirect caused of the great depression as many farmers lost their crops, and defaulted in loan repayments.9 As a result, these farmers were forced to sale off their property at no gains in order to pay off their creditors. Generally, the effects of the great depression were felt at all levels from public institutions to individual households. Many social problems such as crime rates emerged due to the high rates of unemployment and there was a massive migration of people in search of greener pastures in other places.10 The great depression instigated essential changes in the US economic system structure, for instance, the US government was forced to take deliberate economic interventions in ensuring economic stability.11 These were introduced in the form of social insurance, public works, social welfare services, deficit spending, industrial policies and taxation, and they later, these too were adopted by other major economies in Europe. Countries that were greatly hit by the great depression are those that hugely relied on America for financial stability, and these included France, Germany and United Kingdom. The UK relied mostly on exports to the rest of the European nations, and with respect to the international trade restrictions, the UK could not export much of its products as before. The breakdown in international trade had long lasting impacts on the UK’s economy, which hugely depended on exports, and as a result, there was high unemployment. Germany was still obliged to compensate other countries for damages caused during World War 1, and this meant that it had to dig deeper to meet its financial obligations. Germany’s currency was later devalued due to the harsh economic forces; many Germans lost their savings and there was low demand for goods accordingly. Even with the decision by Germany to stop compensations to other nations, there was widespread unemployment, as the economy did not recover until later during the reign of Hitler. On the other hand, France suffered immensely due to the great depression as its underdeveloped economy that was pegged on tourism and farming, and on top of these, the compensation from Germany. With the great depression, there was no more compensation from Germany and many people could not afford the luxury of travelling for amusement. France could not deal with the harsh conditions of the great depression, and as a result, it did not recover quickly until later into the century. Despite its global impact on world economies, the great depression was hardly felt in some of the economies such as Japan and the Soviet Union, and this is attributed to the brilliant intervention made by these nations. For instance, Japan was spared the devastating impacts of the great depression by its concept of deficit spending; this is where by a government expenditure exceeds its earnings. In addition to deficit spending, Japan devalued its currency so that its exports were relatively cheaper in comparison to those from Europe. Because of these economic interventions, Japans economy registered an exponential growth even in the face of the great depression. Soviet Union was largely unaffected by the great depression because of its disdain towards, and none involvement in the capitalist markets fashioned by the US- Europe economic policies. Having remained aloof and stuck to its socialist ideals, the Soviet Union was never affected by the great depression, as it was not in any economic ties with the US, unlike most of the European nations. The great depression had its toll on most of the world economies, and as a result, many changes followed that aimed to restore the global economy to stability. Some of these interventions were successful, but others resulted into a further slum into depression12; ironically, most of the interventions at economic recovery made the depression even great than it had been. For instance, it emerged clearly that restrictive economic and financial policies that were adopted by governments worked to the detriment of the economy other than for the intended purpose.13 Many lessons can be drawn from the great depression that might be of benefit to the modern capital market economies, especially in view of the eminent vulnerability in the global market stability. A good case in point can be drawn from the economic recession in 2000s, which was threatening future stability of global economies; many countries were able to avoid the eminent economic slouch by avoiding a repetition of mistakes made by governments during the great depression. Works Cited Taylor, Nick. “The Great Depression: A Short History of the Great Depression”. Topics.nytimes.com. 2012. Web. 17th Dec 2012. Howarth, David and Becker, Megan. “The Great Depression: Causes of the Great Depression”. Personal.psu.edu. 2009. Web. 17th Dec 2012. Smiley, Gene. “Great Depression”. Econlib.org. n.d. Web. 17th Dec 2012. Kelly, Martin. “Top 5 Causes of the Great Depression”. Americanhistory.about.com. n.d. Web. 17th Dec 2012. “The Great Depression”. History.com. (n.d). Web. 17th Dec 2012 “The Great Depression: Social and Cultural Effects of the Depression”. UShistory.org. n.d. Web. 17th Dec 2012. “Lessons of the 1930s: There could be trouble ahead”. Economist.com. 10th Dec 2011. Web. 17th Dec 2012. Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“TheGreat Depression Term Paper Example | Topics and Well Written Essays - 1500 words”, n.d.)
TheGreat Depression Term Paper Example | Topics and Well Written Essays - 1500 words. Retrieved from https://studentshare.org/history/1465416-theekgreat-depressionek
(TheGreat Depression Term Paper Example | Topics and Well Written Essays - 1500 Words)
TheGreat Depression Term Paper Example | Topics and Well Written Essays - 1500 Words. https://studentshare.org/history/1465416-theekgreat-depressionek.
“TheGreat Depression Term Paper Example | Topics and Well Written Essays - 1500 Words”, n.d. https://studentshare.org/history/1465416-theekgreat-depressionek.
  • Cited: 0 times

CHECK THESE SAMPLES OF Social and Cultural Effects of the Great Depression

The Great Depression

In the years of the great depression, there was a large number of malnourished children due to the poor diet and lack of medical care.... the great depression ... the great depression served as the longest and broadest depression of the economy with the most significant effect in the 20th century.... the great depression brought with it a sporadic diversity in the general sorts of behaviors of the public.... The timeline of the existence of great depression varies for different nations but its main effect was between 1930 and the late 1930s though in some countries it stretched up to the middle of the 1940s decade....
4 Pages (1000 words) Essay

Depression Research Paper

The term depression has many meanings.... For the neurophysiologist, depression refers to any decrease in the electrophysiological activity of an organ or system; as in "cortical depression.... The psychologist designates as "depression" any decrease in normal performance, such as slowing of psychomotor activity or reduction of intellectual functioning.... For clinical psychiatrists and other mental health professionals, however, depression covers a wide range of changes in affective state, ranging in severity from normal, everyday moods of sadness or despondency to psychotic episodes with risk of suicide. ...
17 Pages (4250 words) Essay

Depression: Its Effects on African American Women

The depression ratio amongst African American women is due to diverse variables that are difficult to change and or manipulate in a fashion that is rapid enough to streamline the effects of depression on these women.... These same depression facilitation variables quickly exacerbate the negative effects of depression through synthesized and in many cases tandem continuity factors.... African American women have suffered from highly exertive bouts of depression for years with no end in sight concerning successful treatment strategies....
12 Pages (3000 words) Essay

Social Class and Mental Depression

This study explores the relationship between the social class and mental depression.... Even though there had been evidence off and on that social class is one of the contributory factors to mental depression in both the genders, exclusive studies on social class are very few.... enerations of epidemiologists have tried to find out the association between socio-economic states and mental depression and that the social class of the person, combined or not combined with economics of life is definitely a causative factor....
39 Pages (9750 words) Coursework

The Effect of Perception of Social Roles on Depression

It is difficult to fully assess the effects of depression on the elderly because of the onset of illness and the resulting affects of a diminished health and the medications that are required to sustain life.... Looking at the work that has been developed on the issue, this study will review relevant issues that will be assessed in order to answer research questions that define the focus of the Depending upon the level of the intensity of role involvement, there will be some correlation to the level of depression or other life-altering mental illness for the aged after a decrease in role functionality....
13 Pages (3250 words) Research Paper

Historical Interpretations of the New Deal and the Great Depression

his elaborates the great depression by considering the Roosevelt 1930's efforts and HISTORICAL INTERPRETATIONS OF THE NEW DEAL AND THE GREAT DEPRESSION Outline Introduction The introduction consists of; the effects of the great depression.... Interpreting and Studying This elaborates the great depression by considering the Roosevelt 1930's efforts and considers different authors perception.... rogressive HistoriansThis part talks about the authors who talked about the great depression and new deal....
1 Pages (250 words) Assignment

Major Depressive Disorder and Their Key Characteristics

When a certain number of depression symptoms as mentioned below are reported for longer than 2 week period of time, and when the symptoms disrupt normal social and occupational functioning, then a diagnosis of MDD is made.... The author of this coursework "Major Depressive Disorder and Their Key Characteristics" describes unipolar depression or clinical depression as mood disorders.... The symptoms of depression which are considered for diagnosis are depressed mood, irritability, low self-esteem, feelings of hopelessness, worthlessness, and guilt, decreased ability to concentrate and think, decreased or increased appetite, weight loss or weight gain, insomnia or hypersomnia, low energy, fatigue, or increased agitation, decreased interest in pleasurable stimuli (e....
12 Pages (3000 words) Coursework

Causes of Depression in Athletes

This paper «Causes of depression in Athletes' is of practical interest for coaches and sportsmen who can better understand the correlation between the type of nervous system, temperament, concussion and other risk factors that may contribute to the occurrence of melancholia in athletes.... There are various studies about depression, and all these have important contributions to the lives and performance of the athletes and even the coaches.... Studies reveal information that can help make depression treatment better and even the management of an individual athlete....
12 Pages (3000 words) Coursework
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us