How Did We Get Out of the Great Depression? | Hillsdale College Econ 101

you probably heard some economists or
historian claim that world war two somehow got us out of the Great
Depression the bases this claim lies in what has come to be known as Keynesian economics 1936 British
economist John Maynard Keynes wrote the general theory of employment
interest and money to explain why the Great Depression had
such a long period of time where labor markets the not seen the
comment equilibrium where the demand for labor and the
supply of labor are equal for years lotsa people were
looking for jobs but couldn’t find them Keynes argued
that the problem was a lack of demand for goods and services resulting in a lack of demand for labour
the way to solve this problem according to Cain’s with the increase government spending
the simple Keynesian model states that government spending as the total the man which adds more to
production and more workers being hired for example
towards the end of the Great Depression US government spent lots of money
building all sorts of tanks and planes and ships armaments the fight World War till we
then set them all over the world war many of them were blown up fighting our
enemies but ask yourself would it make any difference apart
enemies look for weapons of war or we took them out to the middle the
Mojave Desert and blew them up ourselves evidently as long as the government cap
spending money building new weapons our economy would grow looking at this
example we might begin to question whether Kansas Terry it’s with how the real world works a
source of confusion even for professional economists comes
from the way we measure our gross domestic product or accurate economic activity those
statistics include not only consumer spending and factories machines
and producer spanning but also government spending no matter
what the government spends that money on sell for example the government hired
you and paid you fifteen dollars to dig a
hole and fill it up again the data would show fifteen dollars in
government spending and fifteen dollars in economic output the same economic principle was seen for
example and billing a fifty million dollar
fighter jet and blowing it up either really creates a better economy
are more prosperity if you know anyone that left the world
war two ask them what it was really like ask them about their ration coupons they
needed to buy even basic products ask if they could buy goods and services
they normally buy we have taken all the military men and
women living in pants while serving in Europe
in the pacific instead move them the Central Park would anyone have said oh my gosh IRCAM
you doing so much better that both would fit the Keynesian theory
how governments could grow their economies would really move this out of the
depression with a combination of factors they would boost our economy today just
as well think good that increase in international trade fewer
government regulations on the economic system and lowered corporate and personal
income tax rates there were implemented after the war you’d like to learn more
about Keynesian economics you can listen to lecture 7 I’ve econ

7 thoughts on “How Did We Get Out of the Great Depression? | Hillsdale College Econ 101

  1. Whoever typed the closed captioning was utterly clueless. Cain's for Keynes!!! And that was after he typed it right before! Kansas Terry for Keynes's theory! Accurate for aggregate! Living in pants for living in tents! Hilarious!

  2. This is a very absurd "scholarly video" about what economic policies ended the Great Depression. So what really lowered the unemployment rate and solved the problem of aggregate demand was, according to the economist, "an increase in international trade, fewer government regulations, and lowered corporate and personal income taxes implemented after the war." BUT THE GREAT DEPRESSION WAS OVER AFTER WWII!!! That's like saying what solved my hunger in the middle of the day was a short nap after lunch. During the highest years of New Deal government spending (1933-39) our government engaged in $2.9 billion dollars of deficit spending. In 1943 alone our government spend $54.5 billion dollars of deficit spending. That is Keynesian economics on steroids. That's how we got out of the Great Depression. Awesome video though, as I actually use this to teach logical fallacies.

  3. They sold them to the allies where do you think all the money from the British Empire went, They were broke after the second world war.

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