Social Science (087) — AI-generated practice question

The Great Depression (1929 – mid-1930s) most directly led post-war planners to this conclusion. During the Depression, markets completely failed to maintain employment — production collapsed, incomes fell catastrophically, thousands of banks closed, and unemployment soared across the industrial world. This demonstrated that markets alone could not guarantee full employment or economic stability. Economists and politicians therefore concluded that governments must intervene to minimise fluctuations in price, output, and employment, and that stable incomes required steady, full employment ensured through active government intervention.

Source: Chapter 3, Sections 3.4 (The Great Depression) and 4.1 (Post-war Settlement and the Bretton Woods Institutions)

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• The examiner wants you to name the specific experience (Great Depression) and link it directly to the lesson about government intervention and full employment.
• Two key points carry the marks: (1) markets failed during the Depression → mass unemployment/collapse; (2) therefore government intervention was necessary to ensure full employment and stable incomes.
• Avoid writing a general essay on the Depression — keep the focus on why it led planners to favour government intervention over free markets.