Introduction To Economic Growth Flashcards
(31 cards)
When determining relevance and importance of players/factors, what must you consider? (4)
• Always prioritise immediate factors over underlying fundamental factors
◦ (Although acknowledge how they mutually interact and complement each other) - to make the growth sustained and at a high rate
◦ Fundamental factors merely ensure growth is possible
• Across what time period is the factor acting on?
• Across which geographical area
• School of thought (nationalist, revisionist etc)
How can factors be grouped (3)
- Internal vs external (originated inside vs outside)
- Early growth/later growth (how a factor changes in importance over growth)
- Long term, short term, immediate
- Type of growth it facilitated (sustained growth, initial growth, reconstruction/recovery)
What were the Post WW2 reconstructions in Western Europe and in japan
EU:
- Germany defeated
- US’s reverse course - strengthened Germany instead of weakening it
Japan:
Reverse course similar
Why did US adopt a reverse course post war for Germany and japan
Socialist (ussr) risk of economic subversion
- weaker countries more susceptible to soviet influence
Germany:
Largest market, main exporter, eu recovery depend on Germany
Japan;
1948: economic crisis + communist threat
What was the result of us post war reconstruction of Germany (gdp growth rate)
Real gdp growth rate of 7.4 per year average from 1949 to 1959
What is meant by economic liberation (1952-73) (4 points)
Sustained economic growth:
- promotion of free trade
- economic deregulation
- elimination of subsidies, price controls, rationing systems
- privatisation of sectors
What rate did manufacture grow globally during the golden age (1945-70s)
4x
When was the golden age of capitalism
1945-73
How did first world growth compare to second and third world 9consider USSR and Eastern European states)
First world:
- sustained over 25 years
3rd world
- unsustained, grew faster but slowed down post 1960
- result of command economy - stagnation that spilled over form USSR to other Eastern European states
- Limited interaction with the 1st world
1945-52 factors
- Early role of USA
- economic liberalisation
- domestic factors within each country (e.g. Europe, japan: govt capitalist policies, economic liberalisation VS USSR planned economy)
At what percent did japan grow by post war (1954-73)
- what was its ranking as an economy
Average of 10% per year (54-73)
- 3rd largest economy post war
What was the motivations for US’s post war reconstruction of Western Europe
- MOST IMPT: Cold War - strategic, security, ideological
- economic reasons - maintain and increase pre war economic power and access to markets - wilsonian idealism
- political - expansionism
Manifestations of US aid (no need stats, just forms) (4)
- provision of economic aid: marshal aid (Europe), Dodge plan (Japan)
- payment of defence needs
- access of US markets
- other indirect factors: US and Bretton woods system, MNCs, tech advancements
What was the key theme for the period from 1945-52
Postwar economic reconstruction
What was the key theme of the period from 1952-late 1960s
Economic liberation (Golden age of capitalism)
What was the key theme of the period from the late 1960s to 1973
Slowing down of economic liberalisation
What was the key theme of the period from the late 1970s to 1990s
Problems of the global economy (crisis decades)
What characterised the economic reconstruction of Western Europe (and Germany) (5)
- abolishment of the command economy
- liberalisation of prices and wages
- elimination of dollar shortages
- restoration of the European division of labour
- remobilisation of the German industry
Who was the largest market and prime exporter of capital goods on the continent during economic reconstruction
West Germany
What was the global economic evolution timeline (1945-1970s, 1970s onwards, 1990s), who was involved in each of the stages
1945-70s:
1st world capitalist economies grew rapidly (economic interaction mainly within first block only)
1970s:
Expansion of global economy
- inclusion of high income developing economies (e.g. Asian tigers)
- beginning if interaction between 3rd world and 1st world
1990s: ussr collapse
- transition to capitalism
- US as capitalist model
Why did Western Europe and japan recover so quickly (other than the us)
- high levels of savings and investment
- wealth of human capital
- high literacy rates, skilled personnel
- increased foreign demand for exports from these countries
What percentage of world trade did France occupy in the 1980s
10%
What was the term for the Germany economic miracle
Wirtschaftswunder
By what extent did industrial production in west Germany increase from 1950-57
2x
