Economic issues 1920-39
- Created by: victoriaclay98
- Created on: 15-06-17 17:41
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- Economic Issues 1929-1939
- The depression and finial crisis
- The wall street crash led to a worldwide economic depression
- Going back on gold standard already made it difficult to sell to other countries - USA out a higher tariff so now Britain could no longer sell to them
- Trade with USA provided income in britian to pay of debts from WW1- loss of trade stopped the income
- countries like Italy were all affected unable to pay britian back from loans during the war.
- Run off then bank- contused banks had to make loans from other countries
- Failure to deal with the crisis led to formation of National Government
- The wall street crash led to a worldwide economic depression
- Changes to economic policy
- Different view with how Britain should deal with economic crisis, like cones agreed with protection over free trade, Kayne said borrow money to start projects to get jobs mostly agreed and wanted tariffs
- Move from the gold standard- after another run off the pound which caused the pound to fall, but made british exports easier and cheaper to sell, but other currencies also left the gold standard well
- By coming of the gold standard Britian didn't need to maintain the pound(high interest rates)- so rates were reduced made it easier for industries to borrow money and also consumers
- Tariff reforms and imperial preference- conservatives believed that introducing tariffs it could make a difference an dropped that the empire would become a self supporting economic unit , free trade within the border but protections from the outside world.
- This led liberal free traders in the coalition to resign in protest
- Didn't have a significant impact on British recovery
- Industry, Trade and Agriculture
- Industry- cutting government spending helped to maintain confidence and stopped the banking crisis, but also lowered total demand of goods and service due to world depression, unemployment rose sharply
- But it did began to recover,but was limited. New industries didn't suffer form great depression and had growth within them(motor industries) even some staple industries started to recover this was due to low prices of product, more people in work than out of it, social trend for smaller families so had more money to spend
- Trade- by 1933 it was 1//3 of its level from 1929, the protection methods to improve trade had limited effects, however after 1933 world trade began to recover as the economy of the rest of the world started to improve
- Agriculture- hit quite hard in the great depression as already had low prices so britian become even more dependent of food imports
- Industry- cutting government spending helped to maintain confidence and stopped the banking crisis, but also lowered total demand of goods and service due to world depression, unemployment rose sharply
- The depression and finial crisis
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