Most nations in Western Europe experienced an economic depression following World War I. How does this compare to the general state of the economies of Western Europe before the war?
Answers
Answer:
1. The heavy reparations, combined with the devastated economic infrastructure throughout Germany and political tension under the Weimar Republic, led to an economic depression. Hyperinflation and unemployment in Weimar Germany were staggering.
2. The war changed the economical balance of the world, leaving European countries deep in debt and making the U.S. the leading industrial power and creditor in the world. Inflation shot up in most countries and the German economy was highly affected by having to pay for reparations.
3.World War I took the United States out of a recession into a 44-month economic boom. ... After the war, it became a lender, especially to Latin America. U.S. exports to Europe increased as those countries geared up for war. Later, U.S. spending increased as it prepared to enter the war itself.
4. The war hurt the economies of Britain, France, and Germany. The cycle of war debt and reparations caused Europe's economy to become dependent on that of the United States.