Guns, Growth, and Global Shifts: How WWII Redrew the Economic Map

World War II was a turning point for the global economy, leveling much of Europe and Asia but also laying the groundwork for revolutionary technological change and growth. The war caused massive destruction of infrastructure and lives, leading to severe labor shortages and economic disruption. Inflation hit record highs-France, for example, saw prices rise by nearly 50% between 1945 and 1948, and Japanese inflation topping over 10,000%. The majority of countries were ruined by debilitating debt and were forced to start anew.

 

But the post-war era witnessed a decade of record economic growth. The United States emerged as a world superpower, leveraging its intact industrial plant and technological advancements to rule the world economy. Europe, aided by initiatives like the Marshall Plan, witnessed per capita GDP increase threefold in the latter half of the 20th century. The war also gave a boost to the evolution of welfare states, new international institutions, and movement towards open-market economies, preparing the foundation for decades of boom and cooperation.

 

Source: Investopedia, IMF, Citeco, BBC