World War I Was The Main Reason For The Booming Economy

Interpretation A supports the view that the First World War was the main reason for the booming economy as it gave impetus to agricultural and industrial expansion which is shown by the annual Gross National Product of the USA increasing by 40% during 1922-29. Furthermore, there was an increase of machinery and productivity, shown by the introduction of the assembly line which allowed for faster manufacturing, due to labour shortages during the war as the workers were at war this is a further viewpoint that World War One was the major reason for the booming industry in America during the 1920s. However, interpretation A also suggests that another major reason was that the government disregarding their policy of laissez-faire and assisting businesses …show more content…
As highlighted by France losing 6,000 factories throughout the war time period. The war did not have this effect on America, in fact it seemed to strengthen its economy which is highlighted by European countries owing them $7 million dollars during the war which they used to buy military equipment, and this was an issue America did not face. Furthermore, World War One had a positive impact on the economy and can be seen as a catalyst to enhance the boom, America was the “leading creditor nation” as a result of the loans to allies and Germany and led to “New York City being able to challenge London as the centre of world finance” and highlighted by more than a fourth of the 300 largest corporations in 1920 were headquartered there. As interpretation C shows strong reasoning as to why World War One was a major reason for the boom, it also supports interpretation A by adding another reasoning why the war played a key role as American “industries had emerged intact, even strengthen, from the war.” The war led to an increased demand from industries which allowed for them to increase the amount of workforce they could have, leading to more people earning money, causing those workers to increase the amount they were spending on consumer goods such as refrigerators, irons and cookers. As a result of this increased spending on consumer goods, it can be linked to interpretation B as the increased supply of electrical sources led to consumer goods being easily accessible, “for the first time electric cookers, irons, refrigerators, fans, toasters and other gadgets were mass produced”. Furthermore, interpretation C supports interpretation B and the notion that the management techniques played a vital role in the economic boom as they had lifted productivity and efficiency to new