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1918-31 Economy - Coggle Diagram
1918-31 Economy
1930 economic problems
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This reduced the cost of government debt and allowed an increase in spending in areas like unemployment benefits in 1934
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Cheaper mortgages led to a boom in housing construction which created 1 in 3 job of all new jobs between 1931 and 1933
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Employment increased due to rearmament in 1935, 15% of unemployed found work in old industries like steel and iron
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Wall Street Crash led to a collapse of global trade and meant nations couldn't pay off debts to Britain
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1920s solutions
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Protectionism
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Baldwin introduced tariffs but this was rejected bu an electorate as food imports would increase in value
However investment was not redirected into new industries like cars and chemicals which could've been developed as an adavantage
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Tax, spending and budget
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1922 Geddes Axe led to cuts in spending on education, pensions, unemployment, housing and health from £206m to £182m
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Polices like taxation were ineffective because unemployment increased since people were unable to pay their taxes (16.9% by 1921). However, there was a partial success as inflation was now negative to -0.53% but this meant economic growth would be slower.