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History, Politics & Society
History of the United States
Australia in WW2
The Great Depression

What are some causes of the Great Depression?

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March 25, 2009 12:27AM

One of the most important factors that led to the Great Depression was the independence of national economies. A major drop in world agricultural prices hurt southern and eastern Europe, where agriculture was small in quantity yet high in cost. When unable to make a profit on the international market, these agricultural countries bought fewer manufactured goods from the more industrial parts of northern Europe, causing a widespread drop in industrial productivity. Restrictions on free trade also limited the economy . Most nations were raising high trade barriers to protect domestic manufacturers from foreign competition. Thus, these two causes combined together to form a major slow-down in the world economy.