In addition, banks were happy to lend money to businesses and individuals, which increased a consumer spending and it lead to consumer boom. That means even if families could not afford goods, they could still bu them and pay later. However, luxuries such as radios, cars, washing machines and telephones could be made so quickly, so the price fell dramatically. Low prices meant the items, once only affordable by the rich, could be purchased by everyone. This increased the number of department stores, in 1920 there were 312 department stores, and by 1929 there were 1395.
Furthermore, the construction was at its busiest in the 1920’s than ever before, as people buy more, factories had to produce more products. This lead to increase of the new factories, needed to produce the increase n new products. In addition to this, office buildings were in high demand for the use of banks, showrooms for cars and new electrical products. Also, because of the increase in the population more public buildings, like schools, cinemas and hospitals were built. This increased the level of employment with more people becoming employed in these new industries and buildings. On top of that, the work week had also dropped from 60 to 48 hours, which gave Americans free time to spend. This lead to increase of the holiday companies, entertainment businesses and the increasing number of cars from 8 million cars on the road in 1920 to 23 million by 1930. Almost everybody in the America had a car, 3 out of 4 families owned one or more cars and people were begging to travel in buses and cars more than on train and foot. These increased road constructions, more petrol stations and more restaurants and hotels.
Advertising also played a part in the boom, these convinced people to buy their items. However, Advertising took place on the posters, radio newspapers, magazines and cinemas; they encouraged people to buy more. When something new had come along everyone had to buy it. It was like competitions between Americans, to see who could get the better things. Also the first newspaper Daily News was introduced in 1919 and many others soon after followed in the 20;s. Magazines changed society as people were more interested in entertainment and people spend more time on fashion, sport and parties.
American public did not only buy goods, they also invested on the Wall Street Stock market and spent on more entertainment, as I said before. As more shares were bought, the businesses expanded even more, and output production increased more. Also the taxation was kept low and businesses and companies were able to keep much of the profit to invest in new factories that produced goods at a cheaper price. Moreover, Workers wages were going up slightly as they were taxed less, which meant again more money to spend.
However, one of the main reasons that caused boom was the confidence in Americans. They were brave enough to invest in the market and set up their own businesses. The also had the confidence to buy good, luxuries items on hire purchase. That confidence also gave Americans to have fun and throw parties. One persons view “ The parties were bigger… the pace was faster, the shows were broader, the buildings were higher, the morals were looser..”. This shows the huge change in the society and Americans were enjoying it. Another view “It was the first truly modern decade and, for better or worse, it created the model for society that the entire world follows today.” This shows that the boom had also changed Americans’ view on society, which is still reflected today.
In the short term I think, without the kick-start that WW1 gave to America, I do not believe that Economical boom would happen. As many European countries continued to import goods from America after WW1 and also the banks received their money with interest, which they lent to people. These lead to setting up new businesses and making big profits and people were spending more on the products and investing on the new businesses, which gave a confidence to Americans, to set up more businesses. All of these, plus other reasons caused an economical boom.
In the middle term, I think the clever inventions and exaggerated advertising helped to cause the boom. It gave Americans a new confidence to think of more and more new inventions that would make their life easier. These new inventions and only 48 hours of work in a week gave Americans a lot of free time on their hands, which of course lead to increase of entertainment companies, leisure and tourism companies. These meant more businesses companies and more money to spend. However, I believe that without advertising people wouldn’t be so much interesting in new products. They wouldn’t spend so much money on these inventions, which means that the companies wouldn’t earn so much money. And factories won’t produce so many products and all of these mean that economical boom wouldn’t happen at all, so this shows that advertising played an important role in the boom.
In the long term, I think the growth of industries, constructions and low unemployment caused the economical boom. As I mentioned before, people were crazy on the new products, so the factories had to produce products in high quantities, which meant they also needed more employers. I think that the low unemployment made a huge difference in America, as more people had a steady income which meant again more money to spend. As the population slowly increased, more public buildings were built, which again meant more jobs. I believe that the boom wouldn’t happen if the number of industries stayed the same, which meant the same number of unemployment and the same amount of money to spend.
In my conclusion I would like to say that America experienced an economic boom in the 1920’s, because of all those small and big reasons that I mentioned before. And I believed that the confidence that America gained from isolationism and from large numbers of profitable businesses after WW1 lead to many changes in society, which of course helped to cause boom. I also think that the major factor that caused Economical boom was the increase in new industries. And the Industrial boom of America is what really caused an Economic boom of the country.
By: Jana Tian, 10M
