There are very few times in history when a country got itself to a place of economic wealth like post-war Germany. From being a threshold country in the 19th century to becoming the most important nation economically in Western Europe, Germany has a history that is not only very interesting but also not all as fancy and sparkling as it seems. This paper will give you a short timeline of the key events that happened in the German economic history between 1945 and 1973 that lead to the success of the nation. You will see that most of the miracle was made possible only with the help of the United States and that the economic growth was not exclusive to Germany. In the end, you will find multiple approaches that all do their bit to explain why Germany and other countries in Western Europe were able to get this massive economic boom.
Table of Contents
1. History
a. Situation after world war two
b. A report on Germany – the decision to rebuild
c. The Currency reform – from Reichsmark to Deutschemark
d. The Marshall Plan – Help from overseas
e. European Payments Union 1950-1958
f. The Social Market Economy
g. Reform of Pensions 1957 by Konrad Adenauer
h. Bretton Woods System
2. Approaches to Causes
a. Path dependency
b. Keynesian Approach
c. Catch up effect
Objectives and Themes
This paper examines the post-war German economic development between 1945 and 1973, specifically questioning the narrative of the 'Economic Miracle' (Wirtschaftswunder). It aims to analyze the key historical events that facilitated recovery and explores various theoretical approaches to explain why Germany and other Western European nations experienced such a significant economic boom during this period.
- The timeline and impact of post-WWII economic reconstruction efforts.
- The influence of the United States, including the Marshall Plan and the Bretton Woods system.
- The role of the currency reform and the implementation of the Social Market Economy.
- Theoretical perspectives on economic growth, including path dependency, Keynesian economics, and the catch-up effect.
Excerpt from the book
c. The Currency reform – from Reichsmark to Deutschemark
The introduction of the Deutschemark was and is still portayed as one of the greatest achievements in the history of Germany’s economy, but it actually wasn’t that kind of miracle most people think of (Hermann 2019). The ideas for the currency reform of 1948 came from 3 Americans: Gerhard Colm, Joseph Dodge and Raymond Goldsmith. These 3 fellows worked out the so called CDG-Plan in 1946, which was the foundation of the currency reform. It should trim the quantity of the money to 1/10th and included a burden sharing for assets like land and real estate. This means that most of the money assets of the population would be annihilated (Hermann 2019). This kind of radical reform could only be implemented by a military power like the United States, because German politicians would need to find more compromises in order to please the electorates. Therefore, Germans were actually not really involved into the process of the currency reform (Hermann 2019). The key person during the negotiations during the currency conclave in 1948 in the German Rothwesten was the American Edward A. Tenenbaum. He is also called the “father of the Deutschemark”4.
The consequence of the introduction of the Deutschemark was an exploding economy and an erratic increase in economic growth. But this was not a miracle, but a logical consequence and more a statistical effect rather than an economical one. There was a so-called shop window effect when the Deutschemark was introduced (Hermann 2019). It did not actually bring all the goods magically to the stores, manufacturers were just holding back inventory because they did not want to trade it for worthless Reichsmark, so they waited until the Deutschemark was introduced. The economic growth was already there.
Summary of Chapters
1. History: This chapter provides a chronological overview of significant events, including the post-war situation, the Marshall Plan, the currency reform, and the emergence of the Social Market Economy.
2. Approaches to Causes: This section investigates theoretical economic frameworks such as path dependency, Keynesianism, and the catch-up effect to explain the underlying factors of western European economic growth.
Keywords
Germany, Wirtschaftswunder, Economic Miracle, Post-war reconstruction, Marshall Plan, Deutschemark, Social Market Economy, Bretton Woods, Path dependency, Keynesianism, Catch-up effect, Cold War, Economic growth, US Foreign Aid, Currency reform
Frequently Asked Questions
What is the core focus of this document?
The paper examines the economic development of Germany between 1945 and 1973, looking beyond the conventional narrative of an "economic miracle" to understand the structural and external factors involved.
What are the primary thematic fields covered?
The main themes include post-WWII reconstruction policies, the influence of international financial systems, domestic economic reforms, and theoretical explanations for rapid national growth.
What is the central research inquiry of this paper?
The paper asks whether the German economic success was truly a "miracle" or rather a logical consequence of statistical effects, international support, and broad European economic trends.
Which scientific methods or frameworks are utilized?
The author uses a historical timeline approach combined with an analysis of specific theoretical economic concepts, such as path dependency, Keynesian investment strategies, and the catch-up growth hypothesis.
What topics are discussed within the main body?
The main body covers the immediate post-war situation, the impact of the Marshall Plan, the 1948 currency reform, the Social Market Economy, pension reforms, the Bretton Woods currency system, and theoretical economic models.
Which keywords best characterize this work?
Key terms include Economic Miracle, Deutschemark, Marshall Plan, Social Market Economy, Keynesianism, and Path dependency.
How does the author characterize the role of the Deutschemark?
The author argues that the introduction of the Deutschemark was less of an economic miracle and more of a technical and statistical adjustment that corrected distortions caused by the worthless Reichsmark and the black market.
What specific view is presented on the 'Social Market Economy'?
The paper suggests that while the concept was marketed as a social balance between socialism and capitalism, in practice it was a pro-business approach that initially maintained a class-based structure rather than fundamentally altering wealth distribution.
What does the paper conclude about the Marshall Plan?
The author acknowledges it served both as economic support and propaganda, ultimately acting as a crucial tool for integrating Germany back into the European economy rather than merely acting as an altruistic donation.
- Arbeit zitieren
- Robert Heller (Autor:in), 2020, Rebuilding Germany after WWII, München, GRIN Verlag, https://www.grin.com/document/1281639
