economic recovery in the years 1945 to 1965 Flashcards
what percentage of housing has been destroyed and how many were further damaged?
20%
30%
what is the statistic on food shortages in terms of calories eaten?
dropped to 950 and 1150 calories per day
what happened to the currency?
became worthless
who was appointed economics minister of the frg in 1949?
ludwig erhard
what was the economics minister’s vision for the economy?
to create a social market economy
what happened to the currency in 1948 and why did this help the economy grow?
currency replaced by the deutschemark
- increased confidence as wages were not worthless
- spending rose
- more profit for businesses
- employ more workers, expand businesses etc
what happened to price controls and rationing, and why did this help the economy to grow?
price controls on products were abolished
- created competition between businesses
- more products available
- higher expenditure undermines lack market
what happened to wages, and why did this help the economy to grow?
wages stayed fixed until november 1948
- businesses could re-invest their profits instead of raising wages
- not exploit workers
what was the 1952 Equalisation of Burdens Act, and why did this help the economy to grow?
additional tax placed on all assets (e.g. property and other valuable goods) which was redistributed to many german people who had suffered severely under nazi rule and during ww2
- increases the ‘buying power’ of more german people
what was the consequence of Erhard’s economic reforms in the short term?
reforms did not bring about immediate economic recovery
factories and busineses still had to spend huge amounts replacing machinery and employing workers
- some collapsed after currency reform as they couldnt afford tyo pay employee wages and others were forced to lay-off workers
what was the consequence of Erhard’s economic reforms in the long term?
enormous economic growth particularly after 1955
what is the period of 1955-1965 also known as?
the economic miracle
what happened to the FRG’s Gross National Product between 1950 and 1955?
almost doubled and rose another 25% by 1960
what happened to unemployment in the FRG by 1965?
unemployment dropped to less than 1%
what happened to trade and exports from the FRG from 1950 to 1970
exports rose exponentially from DM 8,363 mil to DM 125,300 mil
