Question

Explain how the great economic depression affected the German economy.

Answer 1

Hint: 1)It lasted for a long period of time I.e 1929-1939.
2)Depression was a significant event between two world wars.
3)Depression is characterised with factors like unemployment, bankruptcies ,reduction in gdp and gdp growth rate.

Complete answer:
The great depression originated in the USA. After fall of stock prices. It spreaded to Europe also.
The Cause of great depression are-
a)The Speculations on borrowed money.
b)The Rapid selling of stocks.
Also, the Bank failed to further provide credit.
the Economic inactivity due to the ${1}^{st}$ World War.

Effect of depression on germany-
1)Germany’s trade and commerce depended on a large sum of borrowing.
2)The wall street exchange crashed and this led to withdrawal of USA support to germany.
Further industrial production also reduced to 40% in germany.
due to which Unemployment reached its highest like around 30%
3)This all made the german currency collapse ,prices of articles rose which then converted into inflation.
4)The Small business factories all got ruined and further a sharp fall in agricultural production led to a food crisis.
5)Women,peasants,students and children all were in despair and they couldn’t afford to get proper food.
6)Later hitler followed an autarky economic policy by cutting wages and taking control of labor unions ,controlled public work spendings and large sum military spending further helped Germany to bounce back.

Note: 1)With the ongoing pandemic experts are speculating the economy of some countries could begin showing like that of 1930s depression.
2)Unemployment rate has further decreased in some countries like kin usa and india (25% in usa and 23% in india in may 2020
3)Almost all nations were affected by the great economic depression except the USSR.