Post–World War II economic expansion: Difference between revisions
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During this time there was high worldwide economic growth; Western European and East Asian countries in particular experienced unusually high and sustained growth, together with [[full employment]]. Contrary to early predictions, this high growth also included many countries that had been devastated by the war, such as [[Greece]] ([[Greek economic miracle]]), [[West Germany]] ([[Wirtschaftswunder]]), France ([[Trente Glorieuses]]), Japan ([[Japanese post-war economic miracle]]), and Italy ([[Italian economic miracle]]). |
During this time there was high worldwide economic growth; Western European and East Asian countries in particular experienced unusually high and sustained growth, together with [[full employment]]. Contrary to early predictions, this high growth also included many countries that had been devastated by the war, such as [[Greece]] ([[Greek economic miracle]]), [[West Germany]] ([[Wirtschaftswunder]]), France ([[Trente Glorieuses]]), Japan ([[Japanese post-war economic miracle]]), and Italy ([[Italian economic miracle]]). |
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==Specific countries== |
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[[File:Bundesarchiv B 145 Bild-F038788-0006, Wolfsburg, VW Autowerk, Käfer.jpg|thumb|Assembly of the [[Volkswagen Beetle]] in West Germany.]] |
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[[File:Sanyo Transistor.jpg|thumb|A [[transistor radio]] made by [[Sanyo]] in 1959. Japan manufactured much of the world's [[consumer electronics]] during this period.]] |
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The economies of [[economy of Japan|Japan]], [[economy of Germany|Germany]], [[economy of France|France]], and [[economy of Italy|Italy]] did particularly well, each of these countries caught up to and exceeded the [[GDP]] of the [[economy of the United Kingdom|United Kingdom]] during these years, even as the UK itself was experiencing the greatest absolute prosperity in its history. In France, this period is often looked back to with nostalgia as the ''[[Trente Glorieuses]]'', or "Glorious Thirty", while the economies of Germany and Austria were characterized by ''[[Wirtschaftswunder]]'' (economic miracle), and in Italy it is called [[History of the Italian Republic#The_1950s_and_1960s:_the_Economic_Boom|''Miracolo economico'']] (economic miracle). |
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Most [[developing countries]] also did well in this period. |
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===United States=== |
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{{main|Economic history of the United States#Postwar prosperity: 1945–1973}} |
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{{See also|Economic stagnation#The end of the stagnation in the U.S. following the Great Depression}} |
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The period from the end of World War II to the early 1970s was a golden era of American capitalism. $200 billion in [[war bonds]] matured, and the [[G.I. Bill]] financed a well-educated work force. The middle class swelled, as did GDP and productivity. The US underwent its own golden age of economic growth. This growth was distributed fairly evenly across the economic classes, which some attribute to the strength of [[Labor history of the United States|labor unions]] in this period—labor union membership peaked during the 1950s. Much of the growth came from the movement of low income farm workers into better paying jobs in the towns and cities—a process largely completed by 1960.<ref>Michael French, ''US Economic History since 1945'' (1997)</ref> |
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===United Kingdom=== |
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A 1957 speech by British Prime Minister Harold Macmillan<ref>{{cite news |
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|url= http://news.bbc.co.uk/onthisday/hi/dates/stories/july/20/newsid_3728000/3728225.stm |
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|title= 1957: Britons 'have never had it so good' |
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|publisher= BBC |
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|accessdate=2009-03-12 | date=1957-07-20}} |
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</ref> captures what the golden age felt like, even before the brightest years which were to come in the 1960s. {{quote|Let us be frank about it: most of our people have never had it so good. Go round the country, go to the industrial towns, go to the farms and you will see a state of prosperity such as we have never had in my lifetime – nor indeed in the history of this country}} |
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Unemployment figures<ref>{{cite book |
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| last = Sloman |
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| first = John |
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| title = Economics |
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| year = 2004 |
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| page = 811 |
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| publisher=Penguin }}</ref> show that unemployment was significantly lower during the Golden Age than before or after: |
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{|class="wikitable sortable" |
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|- |
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!Epoch !! Date range !! Percentage of British labour force unemployed. |
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|- |
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|Pre Golden Age ||1921–1938||13.4 |
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|- |
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|Golden Age ||1950–1969||1.6 |
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|- |
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|Post Golden Age ||1970–1993 || 6.7 |
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|- |
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|} |
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In addition to superior economic performance, other social indexes were higher in the golden age; for example the proportion of Britain's population saying they are "very happy" has fallen from 52% in 1957 to just 36% in 2005.<ref>{{cite news |
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|url= http://news.bbc.co.uk/1/hi/programmes/happiness_formula/4771908.stm |
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|title= Britain's happiness in decline |
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|publisher= BBC |
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|author= Mark Easton |
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|accessdate=2009-03-12 | date=2006-05-02}} |
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</ref> |
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===West Germany=== |
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{{main|Wirtschaftswunder}} |
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[[West Germany]], under Chancellor [[Konrad Adenauer]] and economic minister [[Ludwig Ehrhard]], saw prolonged economic growth beginning in the early 1950s. Journalists dubbed it the ''[[Wirtschaftswunder]]'' or "Economic Miracle".<ref>Jurgen Weber, ''Germany, 1945-1990'' (Central European University Press, 2004) pp. 37-60</ref> Industrial production doubled from 1950 to 1957, and gross national product grew at a rate of nine or 10% per year, providing the engine for economic growth of all of Western Europe. Labor union support of the new policies, postponed wage increases, minimized strikes, supported technological modernization, and enjoyed a policy of co-determination (Mitbestimmung), which involved a satisfactory grievance resolution system as well as requiring representation of workers on the boards of large corporations.<ref>Friedrich Fürstenberg, "West German Experience with Industrial Democracy," ''Annals of the American Academy of Political and Social Science'' Vol. 431, (May, 1977), pp. 44–53 [http://www.jstor.org/stable/1042033 in JSTOR]</ref> The recovery was accelerated by the [[D-Mark#Currency reform of June 1948|currency reform of June 1948]], US gifts of $1.4 billion [[Marshall Plan]] aid, the breaking down of old trade barriers and traditional practices, and the opening of the global market.<ref>Detlef Junker, ed., ''The United States and Germany in the Era of the Cold War, 1945-1968'' (Cambridge University Press, 2004) vol 1:291-309</ref> West Germany gained legitimacy and respect, as it shed the horrible reputation Germany had gained under the Nazis. West Germany played a central role in the creation of European cooperation; it joined [[NATO]] in 1955 and was a founding member of the [[European Economic Community]] in 1958. |
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===France=== |
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{{main|Trente Glorieuses}} |
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Between 1947 and 1973, France went through a booming period (5% per year in average) dubbed by [[Jean Fourastié]] ''[[Trente Glorieuses]]'', title of a book published in 1979. The economic growth is mainly due to productivity gains and to an increase in the number of working hours. Indeed, the working population was growing very slowly, the ''[[baby boom]]'' being offset by the extension of the time dedicated to studies. Productivity gains came from the catching up with the United States. In 1950, the average income in France was 55% of an American, and reached 80% in 1973. Among the major nations, only Japan had faster growth in this era than France.<ref>P. Sicsic, and C. Wyplosz. "France: 1945-92." in ''Economic Growth in Europe since 1945,'' edited by N. Crafts and G. Toniolo. (Cambridge University Press, 1996)</ref> |
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The extended period of transformation and modernization also involved an increasing internationalization of its economy, France by the 1980s was a leading world economic power and the world's fourth largest exporter of manufactured products. It became Europe's largest agricultural producer and exporter, accounting for more than 10 percent of world trade in such goods by the 1980s. The service sector grew rapidly and became the largest sector, generating a large foreign trade surplus, chiefly from the earnings from tourism.<ref>Andrea Boltho, "Economic Policy in France and Italy since the War: Different Stances, Different Outcomes?," ''Journal of Economic Issues'' 35#3 (2001) pp 713+ [http://www.questia.com/PM.qst?a=o&d=5000888520 online]</ref> |
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===Japan=== |
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{{main|Japanese post-war economic miracle}} |
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After 1950 Japan's economy recovered from the war damage and began to boom, with the fastest growth rates in the world.<ref>James L. McClain, ''Japan: A Modern History'' (2002) pp 562-98</ref> Given a boost by the [[Korean War]], in which it acted as a major supplier to the UN force, Japan's economy embarked on a prolonged period of extremely rapid growth, led by the manufacturing sectors. Japan emerged as a significant power in many economic spheres, including steel working, car manufacturing and the manufacturing of electronics. Japan rapidly caught up with the West in foreign trade, GNP, and general quality of life. The high economic growth and political tranquility of the mid to late 1960s were slowed by the quadrupling of oil prices in 1973. Almost completely dependent on imports for petroleum, Japan experienced its first recession since World War II. Another serious problem was Japan's growing trade surplus, which reached record heights. The United States pressured Japan to remedy the imbalance, demanding that Tokyo raise the value of the yen and open its markets further to facilitate more imports from the United States.<ref>Hans Brinckmann, and Ysbrand Rogge. ''Showa Japan: The Post-War Golden Age and Its Troubled Legacy'' (2008)</ref> |
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===Soviet Union=== |
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In the 1950s the Soviet Union, having reconstructed the ruins left by the war, experienced a decade of prosperous, undisturbed, and rapid economic growth, with significant technological achievements most notably the [[Sputnik I|first earth satellite]]. The nation ranked in the top 15 most prosperous countries. However, the growth slowed and ended by 1960, as the [[Khrushchev era|Khrushchev regime]] poured resources into large military and space projects, and the civilian sector languished. While every other major nation greatly expanded its service sector, that sector in the Soviet Union (medicine, for example) was given low priority.<ref>Gur Ofer, ''The service sector in Soviet economic growth'' (1973) [http://books.google.com/books?id=ARyfDoATNogC&pg=PA21&dq=soviet+economic+growth+1950s&hl=en&sa=X&ei=MiT_TpaWH8OhiQLipKWMDQ&ved=0CDUQ6AEwAA#v=onepage&q=soviet%20economic%20growth%201950s&f=false p. 21 online]</ref> Following Khrushchev's ouster, and the appointment of a [[collective leadership]] led by [[Leonid Brezhnev]] and [[Alexei Kosygin]], the economy was revitalised.<ref name="declineinevitable">{{cite book | author = Sandle, Mark; Bacon, Edwin | title = Brezhnev Reconsidered | location = | publisher = [[Palgrave Macmillan]] | year = 2002 | isbn = 978-0-333-79463-0 | pages = 44–45 }}</ref> The economy continued to grow apace during the mid-to-late 1960s, during the [[Eighth Five-Year Plan (Soviet Union)|Eighth Five-Year Plan]].<ref>{{cite book | author = [[Archie Brown|Brown, Archie]] | title = The Rise & Fall of Communism | publisher = [[Bodley Head]] | year = 2009 | isbn = 978-1-84595-076-5 {{Please check ISBN|reason=Check digit (5) does not correspond to calculated figure.}} | page = 403 }}</ref> However, economic growth began to falter during the early to mid-1970s,<ref name="declineinevitable"/> beginning an [[Era of Stagnation]]. |
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===Sweden=== |
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{{Further|History of Sweden (1945–1967)}} |
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Sweden emerged [[Sweden during World War II|unharmed]] from World War II, and experienced a tremendous economic growth until the early 1970s, as [[Social Democrats (Sweden)|Social Democratic]] Prime Minister [[Tage Erlander]] held his office from 1946 to 1969. Sweden used to be a [[emigration from Sweden to the United States|country of emigrants]] until the 1930s, but the demand for labor spurred immigration to Sweden, especially from southern Europe. Urbanization was fast, and housing shortage in urban areas was imminent until the [[Million Programme]] was launched in the 1960s. |
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==Decline== |
==Decline== |
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Revision as of 14:12, 2 April 2014
- "Golden Age of capitalism" redirects here. Other periods this term may refer to are Gilded Age and Belle Époque.
The post–World War II economic expansion, also known as the postwar economic boom, the long boom, and the Golden Age of Capitalism, was a period of economic prosperity in the mid-20th century which occurred, following the end of World War II in 1945, and lasted until the early 1970s. It ended with the collapse of the Bretton Woods system in 1971, the 1973 oil crisis, and the 1973–1974 stock market crash, which led to the 1970s recession. Narrowly defined, the period spanned from 1945 to 1952, with overall growth lasting well until 1971, though there are some debates on dating the period, and booms in individual countries differed, some starting as early as 1945, and overlapping the rise of the East Asian economies into the 1980s or 1990s.
During this time there was high worldwide economic growth; Western European and East Asian countries in particular experienced unusually high and sustained growth, together with full employment. Contrary to early predictions, this high growth also included many countries that had been devastated by the war, such as Greece (Greek economic miracle), West Germany (Wirtschaftswunder), France (Trente Glorieuses), Japan (Japanese post-war economic miracle), and Italy (Italian economic miracle).
Decline
The optimism waned however in the 1970s as high oil prices (due to the 1973 oil crisis) hastened the transition to the post-industrial economy, and a multitude of social problems began to emerge. During the 1970s steel crisis, demand for steel declined, and the Western world faced competition from newly industrialized countries. This was especially harsh for mining and steel districts such as the North American Rust Belt and the West German Ruhr area.
See also
Post-war context
- Aftermath of World War II
- Bretton Woods system, monetary system of this period
- European Coal and Steel community
- Counterculture of the 1960s
- Cold War
- Post–World War II baby boom
- Second Great Migration (African American)
Contemporary booms
Europe
- Greek economic miracle
- Record years, Sweden
- Spanish miracle
- Italian economic miracle
- Trente Glorieuses, France
- Wirtschaftswunder, Germany and Austria
East Asia
- East Asian Tigers, Hong Kong and Singapore
- Japanese post-war economic miracle
- Miracle on the Han River, Korea
- Taiwan Miracle