The US economic boom of the 1920s was primarily due to the motor manufacturing industry How far do you agree with this view?

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‘The US economic boom of the 1920s was primarily due to the motor manufacturing industry’ How far do you agree with this view?

At the end of the First World War, America was in a good position as the war had not directly damaged the society and the demand for their goods had increased causing a hasty rise in the industry. The reason for the economic boom was because of factors such as the motor manufacturing industry, easy credit, policies of the republican presidents and confidence.

Confidence allowed an economic boom as wealth had increased as a result of the First World War therefore leading to the rise of confidence in people and businesses. Stocks and shares had risen in value and the economic production and growth had sustained. People had more confidence in the new products which were being produced for example, radios, telephones etc. and due to them being rich they were willing to take the risk and stake their money on expensive and electrical products including Ford’s Model T cars. This shows that confidence was crucial as this was the factor which enhanced everyone’s trust in products which were being produced enabling demands for consumer goods to increase causing more money to be brought into the economy.

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The republican government believed that the government should have little interference in the lives of American people which became known as Laissez-faire. In their view, they thought that the president, in this case Calvin Coolidge to leave businesses alone and allow them to do what they wanted. However, Coolidge stated that “The chief business of the American people is business” suggesting that he also followed the Laissez-faire attitude and thought that businesses should be left alone leading to there being no checks on businesses so they could do what they wanted without restriction. The risk to this attitude was overproduction ...

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