Causes of the economic boom

Causes of the economic boom

What is an economic boom?

​The boom

The US economic boom was in part a result of America’s natural resources and assets, notably its cheap labour supply. A boom occurs when the economy of a country is rapidly developing. Factories make and sell a lot of goods which, in turn, make money that is put back into factories, to make and sell goods and make even more money.

​Natural resources

The USA had lots of raw materials including oil, coal, wood and iron. These resources provided the foundation for the economic growth.

 

​Cheap labour

There was continuous immigration from Europe to the USA in the years before the First World War. This provided a plentiful supply of cheap, unskilled labour from Germany, Scandinavia, Italy, Poland, Russia, Ireland, China and Japan.

 

Multiple Choice

What were America's natural resources?

• iron, coal, wood, copper

• iron, copper, oil, wood

• coal, wood, iron, oil

• coal, steel, wood, iron

​Credit - hire purchase

The growth of credit made it much easier for people to buy goods even when they did not have enough cash to pay for them immediately. Under the system of hire purchase and credit, goods were paid for in instalments. About half the goods sold in the 1920s were paid for by hire purchase.

 

Drag and Drop

There was continuous ​

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from ​

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to the USA in the years before the​

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. This provided a plentiful supply of ​

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, unskilled labour from Germany, ​

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, Italy, Poland, Russia, Ireland, China and Japan. 

Drag these tiles and drop them in the correct blank above

immigration

Europe

First World War

cheap

Scandinavia

emigration

Asia

Second World War

expensive

Africa

European countries bought much-needed supplies from the USA. Money poured into the USA for food, raw materials & munitions (weapons). This led to the growth of US industry and agriculture.

 

​Supplies

As EU countries, like Britain and Germany, fought in the war US manufacturers and farmers took over European overseas markets. For example, the US took over from Germany as the world’s leading producer of fertilisers & chemicals.

 

​Overseas markets

First World War

The war stimulated technological advances, especially mechanisation, as well as the development of new raw materials such as plastics. The USA led the world in new technology.

 

New technology

Many countries borrowed huge sums of money from the USA. American bankers and businessmen invested in Europe and made money once the economies of these countries recovered in the 1920s.

 

​Loans

First World War

Categorize

Options (14)

Native Americans, black Americans, immigrants

More goods were sold

People had to pay back with interest - more money being made

oil, coal, wood and iro

They sold the

They used them to build industr

Less pay, more profits for businesses

America took Europe's customers

America sold supplies and munitions to Europe

America loaned Europe money

America used the profit to build new technology

America sold lots of goods and made profit

Europe had to pay back the loans with interest - more money

Buy now, pay later - in instalments

Organize these options into the right categories

Natural Resources

Cheap Labour

Hire Purchase

First World War