Question

When did the Great Economic Depression begin?

• A. 1928
• B. 1929
• C. 1930
• D. 1932

Hint:

The Great Economic Depression began in 1929, triggered by the Stock Market Crash. It led to global unemployment, reduced trade, and economic hardship, influencing political movements around the world, including India’s struggle for independence.

Answer 1

The Correct Option is B

The Great Economic Depression began in 1929 and is widely regarded as the most severe worldwide economic downturn in modern history. It started with the Stock Market Crash in the United States on October 29, 1929 (also known as Black Tuesday). This event triggered a series of financial collapses that led to widespread unemployment, business bankruptcies, and an overall collapse in industrial and agricultural production. Causes of the Great Depression:

1. Stock Market Crash (1929):
- The immediate cause of the depression was the collapse of the stock market in the United States. Stock prices, which had been artificially inflated during the Roaring Twenties, plummeted as investors lost confidence, leading to mass selling of stocks. This crash quickly spread to other economies, particularly those with close economic ties to the U.S.
2. Bank Failures:
- As stock prices fell and businesses failed, many banks also collapsed due to their exposure to bad loans and investments. The collapse of these banks further worsened the crisis by reducing the availability of credit, which is crucial for businesses to operate.
3. Decline in International Trade:
- The depression caused a significant drop in global trade. Many countries, including the U.S., Europe, and even some parts of Asia, saw a reduction in demand for goods, leading to falling production rates and increasing unemployment.
4. Agricultural Collapse:
- The agricultural sector was severely impacted by the depression. Prices for agricultural products dropped sharply, and many farmers were unable to repay loans, leading to farm foreclosures. This was especially problematic in countries like the U.S., where farmers had a significant share of the economy.
5. Deflation:
- A key feature of the Great Depression was deflation—a period of falling prices. As demand for goods and services fell, prices dropped, which in turn caused wages to decrease and led to further declines in consumer spending and production. Impact on India:
- Although the Great Depression began in the Western world, its effects were felt globally, including in India, which was under British rule at the time. - The most significant impacts in India were felt in the agricultural sector, where prices for export crops like cotton, jute, and wheat fell drastically. This led to widespread economic hardship for farmers, who were already struggling under British-imposed taxes. - The economic distress was also felt in the industrial sector, as industries that depended on exports were hit hard by the global downturn. - The depression aggravated the already existing problems of poverty and unemployment in India. It also led to a rise in political activism and resentment against British rule, contributing to the increasing support for the Civil Disobedience Movement and other anti-colonial activities led by the Indian National Congress. Conclusion:
The Great Depression of 1929 had far-reaching consequences worldwide. It not only impacted the economies of the United States and Europe but also significantly affected colonial economies like India's. It highlighted the need for economic reforms and contributed to the growing unrest that ultimately played a role in the Indian independence movement.