The Economic Boom of the 1920s

The 1920s were a time of change for the people of America, and they began with a boom. This boom was initially caused by the combination of America’s inherent rich natural resources and the First World War, and was further propelled by the lack of regulation on business as promoted by the Republican government and by new, different, improved methods of operation in business and industry. Though the boom would never have occurred without the initial causes, the boom would never have had such a profound impact on all aspects of economics and society as it did if it had not been for the revolution in industry and its effect on the state of mind of the American population. The main reason for the boom in the 1920s was the confidence and new attitudes of the population, which both caused and were caused by the boom, and which thereby sustained the boom.

The boom began as a result of America’s immense industrial power. This was caused in large part by the First World War and the unique nature of America’s involvement therein. For most of the war America did not actively participate, and instead lent money and exported arms, munitions and food supplies to the Allies (Walsh 187). They also took the opportunity to expand their markets in the colonies of the warring countries, and they reaped economic benefits. Furthermore the war conveniently destroyed their industrial competitors; after the war, many countries’ industries were impoverished. Their industries in steel, coal, oil and textiles remained strong after the war, and their chemical and film industries developed; America was the industrial leader of the world (Walsh 186). Moreover the growth and actions of these businesses were left unregulated by the predominantly Republican gover...

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...heir industries economy and futures, resulting continued investment and consumption to continue fuelling the boom.

The boom began as a result of circumstances largely irrelevant to the general American population, but once set in motion the machine was driven by the people. People had the time and money to buy goods and invest in the economy, which boomed; so unemployment fell and wages rose. More people were employed and had money, which they used to buy consumer products, which then continued to fuel the booming economy. Therefore the main reason for the boom in the 1920s was the increased accessibility of consumer products, and the subsequent empowerment of the consumers. The boom in the 1920s marked the birth of mass market and the consumer-driven economy.

Works Cited

Walsh, Ben. GCSE Modern World History. 2nd ed. 1996. London: John Murray, 2001.

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