Introduction
The great depression occurred in early 1930s and it served as a yardstick for speed and depth analysis of the international economies. It is important to understand what led to great depression in order to avert similar event occurring again. Analysis indicated that not only does the economist argues about the events that led to Great Depression they also have divergent views about the origin and how it spread to affect the whole world(Almunia, et al., 2010). Economic indices indicated that economic recovery in the 1931 after the Great Depression was slower as compared to the recovery after the Great Depression of the 2008. Although many scholars have argued that United States of America was the center of the Great Depression, economic indices indicated that many European countries had already weak economy in the mid-1920s.
However, it is important to understand that the type and number of indicators of Great Depression varies from one country to another. For example, during the Great Depression Great Britain relied heavily in the production of coal since it was already an industrialized country. This make coal production an important indicator for Great Depression in the Great Britain, but this indicator was insignificant to unindustrialized country such as Denmark(Uebele & Albers, 2015). Therefore, it is important to balance real and nominal variables as the indicator of Great Depression. Real indicators of Great Depression include the count data such as the individuals’ unemployment as well as the physical measures such as the tonnage of goods transported through the railway. Economist have categorized indicators of Great Depression into seven: Stock market, central banking, private banking, price of the commodities, production, sales, employment and transport, trade and the production indices.
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