The Great Depression

One of the most important causes of the Great Depression was the maldistribution of wealth. During the late 1920s, industrial and agricultural production increased greatly. However, farmers and workers only received meager profits; thus they could not buy the produced goods. Consequently, the economy could not sustain a balance between demand and supply. Industries that experienced this drop in demand were forced to fire workers, so the purchasing power of Americans further diminished. Essentially, the maldistribution of wealth created a significant gap between the rich and the poor; the middle class, which majorly contributed to the economy, nearly disappeared. This economic disequilibrium resulted in the most severe recession in history.