1920s Economy

Question 1

Which areas were depressed in the 20s?

Answer 1

Industrial areas in the north such as Glasgow Newcastle and Belfast

Question 2

World export trade

Answer 2

Britain’s share fell from 18% to 11%

Question 3

Value of overseas investments

Answer 3

There is a drop in the value therefore Britain struggle to pay for imports London no longer financial capital
USA replace Britain
dollar replaced pound as leading currency

Question 4

Short-term problems the gold standard

Answer 4

Britain forced off the gold standard

This weakened the £ in terms of trading

Question 5

What was the gold standard?

Answer 5

A system under which currency was tied to gold
International payments were made in gold
Meant to smooth out fluctuations in economy

Question 6

Competition from other countries (short-term)

Answer 6

Coal face competition from Poland and Germany
Oil replace coal as ship fuel and some countries developed hydro-electricity
Excess of coal for most of 20s

Question 7

Staple industries (short-term)

Answer 7

Hit hard due to restrictions on trade and have a foreign competition
Both lowered demand
Outdated this pushed up costs
Average coal mine 1920 was over 50 years old this made staples less competitive

Question 8

Government made things worse (short-term)

Answer 8

Geddes cuts 1921 deep and unemployment

no consistent policy to restructure and modernise declining industries

Question 9

Positive aspects of the 1920s economy

Answer 9

Industries of the “second industrial revolution “ E.g. motor vehicles and canned foods grew quickly
Motorcar production 20s was 3x 1913
National Grid brought new inflexible power to industry and homes
Productivity and living standards increased
1923 to 29 overall economic growth faster than before 1914

Question 10

What was the trade cycle?

Answer 10

Economy moving through periods of expansion and recession
produced two major slumps
For example 1921 to 22 and 1929 which both post unemployment over 2 million

Question 11

Staple industries (long-term)

Answer 11

The war led to lost export markets and overproduction in staple and heavy industries like shipbuilding and steel

Question 12

International (long-term)

Answer 12

International trade was disrupted and took until 1925 to return to 1913 levels
Britain forced to sell off many overseas investments

Question 13

New industry (long-term)

Answer 13

Electric Power freed industry so it didn’t have to be near the coalfields new industries favoured the Midlands and South East
Unemployment is low in these areas

Question 14

Unemployment in the 20s

Answer 14

In 1921 it was 2 million

for the rest of the 20s stayed above 1 million