the great depression causes worksheet

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04-02-2025

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The Great Depression: Causes and Consequences Worksheet

This worksheet explores the multifaceted causes of the Great Depression, a period of unprecedented economic hardship that profoundly impacted the global community. Understanding these contributing factors is crucial for comprehending the scale of the crisis and its lasting effects.

Part 1: Identifying the Key Causes

The Great Depression wasn't caused by a single event, but rather a confluence of interconnected factors. Below are some key contributing elements. Briefly explain the role each played in triggering the economic downturn.

1. Stock Market Crash of 1929 (Black Tuesday):

Explain: The stock market crash wasn't the cause of the Depression, but it acted as a catalyst, accelerating existing economic weaknesses and triggering a rapid decline in investment and consumer confidence. The overvalued nature of the market, fueled by speculation and easy credit, made the crash particularly devastating.

2. Overproduction and Underconsumption:

Explain: Factories were producing more goods than consumers could afford to buy. This surplus led to falling prices, reduced profits for businesses, and ultimately, widespread unemployment as companies cut back production and laid off workers. A significant gap existed between the productive capacity of the economy and the purchasing power of the population.

3. Banking Panics and Monetary Contraction:

Explain: A series of bank failures eroded public confidence in the financial system. As banks collapsed, people lost their savings, further decreasing consumer spending and investment. The Federal Reserve's contractionary monetary policy, aimed at curbing inflation, unintentionally worsened the crisis by reducing the money supply and credit availability.

4. Dust Bowl:

Explain: Severe drought and dust storms devastated agricultural regions in the American Midwest, leading to crop failures, widespread farm bankruptcies, and mass migration from rural areas to already struggling cities. This compounded the existing economic woes, adding to unemployment and social unrest.

5. High Tariffs and Protectionism (Smoot-Hawley Tariff Act):

Explain: The Smoot-Hawley Tariff Act, designed to protect American industries, backfired by triggering retaliatory tariffs from other countries. This severely reduced international trade, further depressing global economic activity and exacerbating the Depression's impact worldwide.

6. Unequal Distribution of Wealth:

Explain: A significant portion of national wealth was concentrated in the hands of a small percentage of the population, leaving a large segment of the population with limited purchasing power. This imbalance contributed to underconsumption and weakened the overall economy's resilience.

Part 2: Connecting the Dots

1. Explain how the Stock Market Crash of 1929 interacted with the issue of overproduction and underconsumption to worsen the economic crisis.

2. Describe the domino effect of bank failures on consumer confidence and spending. How did this contribute to the downward spiral?

3. Discuss the international implications of the Great Depression. How did the crisis spread globally, and what role did protectionist policies play?

Part 3: Long-Term Impacts

1. What were some of the lasting social and political consequences of the Great Depression?

2. What economic policies and institutions emerged as a result of the Great Depression to prevent future crises? (Consider the New Deal in the US as an example)

This worksheet provides a framework for understanding the complex interplay of factors that led to the Great Depression. By examining each element and their interconnections, a clearer picture of this significant historical event emerges. Further research into specific aspects is encouraged to deepen your understanding.