War and the Market Economy by Lester B Stone

Author:Lester B Stone [Stone, Lester B]
Language: eng
Format: epub
Publisher: Alpha Editions
Published: 0101-01-01T00:00:00+00:00

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Post–World War II and Economic Expansion

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 monetary 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. 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 Japan (Japanese post-war economic miracle), West Germany (Wirtschaftswunder), France (Trente Glorieuses), Italy (Italian economic miracle), and Greece (Greek economic miracle).

Terminology

In academic literature, the period is frequently referred to as the post–World War II economic boom, though this term can refer to much shorter booms in particular markets. It is also known as the Long Boom, though this term is generic and can refer to other periods.

The golden age of Capitalism is a common name for this period in both academic and popular economics books. The term is also used in other contexts. In older sources and occasionally in contemporary ones, Golden age of Capitalism can refer to the period of the Second Industrial Revolution from approximately 1870 to 1914, which also saw rapid economic expansion. Yet another name for the quarter century following the end of World War II is the Age of Marx, though the Soviet Union’s economic statistics were not reliable during this period.

Periodisation

Economist Roger Middleton states that economic historians generally agree on 1950 as the start date for the golden age, while Robert Skidelsky states 1951 is the most recognized start date. Both Skidelsky and Middleton have 1973 as the generally recognized end date, though sometimes the golden age is considered to have ended as early as 1970.

The boom ended with a number of events in the early 1970s:

•the collapse of the Bretton Woods monetary system in 1971

•the growing international trade in manufactured goods, such as automobiles and electronics

•the 1973 oil crisis,

•the 1973–1974 stock market crash,

•the ensuing 1973–75 recession, and

•the ensuing displacement of Keynesian economics by monetarist economics.

While this is the global period, specific countries experienced booms for different periods; in Taiwan, the Taiwan Miracle lasted into the late 1990s, for instance, while in France the period is referred to as Trente Glorieuses (30 glorious [years]) and is considered to extend for the 30-year period from 1945 to 1975.

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