Economic boom 1920s

avergae wage rises 1923-29

rises by 8%

fraction of homes with electricity by 1927

2/3

developments in advertising

• hiring of psychologists eg, Lucky Strike encouraged female consumers by rebranding as ‘torches of freedom’

• increased by outreach of new mass media - radio

• celebrity endorsements eg, Andy&amos show sponsored by Pepsodent

by 1929, annual spenidng on advertising

$3billion

1929 - radio attracted an audience of

50 million

credit

growth of credit made it much easier for people to buy goods even if they could not pay immediately - more accessible

fraction of goods bought by hire purchase in the 1920s

approx. 1/2

laissez-faire governement policy

• Harding and Coolidge - like many Americans - belived that gov should be involved as little as possible in the day to day running of the economy

• laws concerning price fixing often ignored

• contributed to prosperity - businessmen could dictate their own practices

rugged individualism gov. belief

influenced by the settlers of the West, presidents such as Hoover believed that successes was dictated by individual hard work

protectionism gov policy

government placed tariffs on gov to limit competition from foreign exports eg, Fordney McCumber tariff

Fordney McCumber tariff

1922 - protectionist tariffs to the highest level ever - to prtotect US industry

additionally reduced income tax rates, increasing disposable income

Mellon’s tax reductions to businesses and corporations totalled

$3.5 billion

the Mellon plan/ influence of Andrew Mellon

Mellon was secretary of the treasury under Harding, coolidge and Hoover

his philosophy was one of fiscal conservativism (reduced gov spending, tax cuts) which created the perfect environment for husiness and the free market to grow

by 1920, the top 200 companies

controlled 20% of the nation’s wealth

Frederick Taylor’s book

“The principles of scientific management'“ in 1911

his ideas underpinned the use of the assembly line

growth in manangement science and business schools

89 business schools by 1923

development of electricity - used in

conveyor belt and mass production techniques, power for factories etc.

mass production/conveyor belts made…

clocks, typewriters, bicycles, firearms, sewing machines etc.

techonological innovation in the household

• plastics like bakelite developed and used in household products

• (also boosted by advertising and consumerism)

by end of the 20s, how many cars on the road

4.5 million cars

Ford introduces the assembly line in Detroit - year

1913 - had previously been used in slaughterhouses

produced 1 car every 3 minutes

production line time by 1920

1 car every 10 seconds

Ford reduced the Working day length to

8 hours - made a third shift so factorie could operate all 24hrs

Ford’s wages

$5 (1914) - double the usual, workers rushed to Detroit to work for him

Ford’s method brought the price of cars down

the revolution in Ford’ practice (quicker production, higher wages, increased efficiency) enabled him to price his cars lower, making cars more accessible

price of a car 1914

approx. $850

price of a car 1926

approx $295

car industry provided jobs for…

more than 5 million people

percent of US goods used by the car industry

• 90% of petrol

• 805 of rubber

• 75% of plate glass

cars transformed the American way of life

eg, hire purchase, road building and travel accessibility

Federal Highway Act year

1921

Federal highway act 1921

federal gov takes responsibility for road building, highways constructed at a rate of 10,000 miles per year by 1929

gallon of petrol used in 1929

15 billion gallons

stock market boom years

1928-29 stock market dramatically rose after a steady increase

“even the shoeshine boy”

became a common practice for people to buy/trade/sell stocks and shares regardless of class - ealth was becoming more accessible

no. of shares traded in 1926

451 million

no. of shares traded in 1927

577 million - increase

by 1928 there was a ‘…’ market on wall st.

bull

shares sold in 1929

more than 1.1 billion

no. of Americans involved in shares dealing

up to 25 million Americans