Glossary:Great Depression

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Great Depression

The Great Depression was a severe worldwide economic depression that took place during the 1930s. The timing of the Great Depression varied across nations; in most countries it started in 1929 and lasted until the late 1930s.[1] It was the longest, deepest, and most widespread depression of the 20th century.[2] In the 21st century, the Great Depression is commonly used as an example of how far the world's economy can decline.[3]

The depression originated in the United States, after a major fall in stock prices that began around September 4, 1929, and became worldwide news with the stock market crash of October 29, 1929 (known as Black Tuesday). Between 1929 and 1932, worldwide GDP fell by an estimated 15%. By comparison, worldwide GDP fell by less than 1% from 2008 to 2009 during the Great Recession.[4] Some economies started to recover by the mid-1930s. However, in many countries, the negative effects of the Great Depression lasted until the beginning of World War II.[5]

The Great Depression had devastating effects in countries both rich and poor. Personal income, tax revenue, profits and prices dropped, while international trade plunged by more than 50%. Unemployment in the U.S. rose to 25% and in some countries rose as high as 33%.[6]

Cities all around the world were hit hard, especially those dependent on heavy industry. Construction was virtually halted in many countries. Farming communities and rural areas suffered as crop prices fell by about 60%.[7][8][9] Facing plummeting demand with few alternative sources of jobs, areas dependent on primary sector industries such as mining and logging suffered the most.[10]


Read more...
  1. John A. Garraty, The Great Depression (1986)
  2. Charles Duhigg, "Depression, You Say? Check Those Safety Nets", The New York Times, March 23, 2008.
  3. Barry Eichengreen, Hall of Mirrors: The Great Depression, The Great Recession, and the Uses-and Misuses-of History (2014)
  4. Roger Lowenstein, "History Repeating," Wall Street Journal Jan 14, 2015
  5. Garraty, Great Depression (1986) ch1
  6. Frank, Robert H.; Bernanke, Ben S. (2007). Principles of Macroeconomics (3rd ed.). Boston: McGraw-Hill/Irwin. p. 98. ISBN 0-07-319397-6. 
  7. "Commodity Data". US Bureau of Labor Statistics. Retrieved 2008-11-30. 
  8. [[Willard Cochrane |Cochrane, Willard W.]] (1958). Farm Prices, Myth and Reality. p. 15. 
  9. "World Economic Survey 1932–33". [[wikipedia:League of Nations|]]: 43. 
  10. Mitchell, Depression Decade

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