Summary Of "Prosperity And Crisis. Reconstruction, Growth And Change (1945-1980)" By Herman Van Der Wee: UNIVERSITY SUMMARIES

By MAURICIO ENRIQUE FAU

We have summarized the essentials of the following chapters of this book: "Economic Growth As A Challenge For Economic Policy", "The Advent Of The Mixed Economy", "The Road Towards A New World Economic Order", among others. 

• Language: English
• Publisher: BOOKS AND SUMMARIES BY MAURICIO FAU
• Release date: Nov 26, 2021
• ISBN: 9798201584399

MAURICIO ENRIQUE FAU

Mauricio Enrique Fau nació en Buenos Aires en 1965. Se recibió de Licenciado en Ciencia Política en la Universidad de Buenos Aires. Cursó también Derecho en la UBA y Periodismo en la Universidad de Morón. Realizó estudios en FLACSO Argentina. Docente de la UBA y AUTOR DE MÁS DE 3.000 RESÚMENES de Psicología, Sociología, Ciencia Política, Antropología, Derecho, Historia, Epistemología, Lógica, Filosofía, Economía, Semiología, Educación y demás disciplinas de las Ciencias Sociales. Desde 2005 dirige La Bisagra Editorial, especializada en técnicas de estudio y materiales que facilitan la transición desde la escuela secundaria a la universidad. Por intermedio de La Bisagra publicó 38 libros. Participa en diversas ferias del libro, entre ellas la Feria Internacional del Libro de Buenos Aires y la FIL Guadalajara.

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Summary Of Prosperity And Crisis. Reconstruction, Growth And Change (1945-1980) By Herman Van Der Wee

UNIVERSITY SUMMARIES

MAURICIO ENRIQUE FAU

Published by BOOKS AND SUMMARIES BY MAURICIO FAU, 2021.

While every precaution has been taken in the preparation of this book, the publisher assumes no responsibility for errors or omissions, or for damages resulting from the use of the information contained herein.

SUMMARY OF PROSPERITY AND CRISIS. RECONSTRUCTION, GROWTH AND CHANGE (1945-1980) BY HERMAN VAN DER WEE

First edition. November 26, 2021.

Copyright © 2021 MAURICIO ENRIQUE FAU.

ISBN: 979-8201584399

Written by MAURICIO ENRIQUE FAU.

Table of Contents

Title Page

Copyright Page

Van Der Wee, Herman | PROSPERITY AND CRISIS. RECONSTRUCTION, GROWTH AND CHANGE, 1945-1980.

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Further Reading: Summary Of The Roots And The Fruits: Topics Of Philosophy Of Science By Eduardo Flichman

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Van Der Wee, Herman

PROSPERITY AND CRISIS. RECONSTRUCTION, GROWTH AND CHANGE, 1945-1980.

CHAPTER 2 ECONOMIC GROWTH AS A CHALLENGE FOR ECONOMIC POLICY: THE SILVER YEARS 50 AND THE GOLDEN YEARS 60

Economic growth as a challenge for economic policy: the silver 1950s and the golden 1960s. The depressions of the 1930s and the consequences of the Second World War made it unavoidable not to listen to the followers of Keynes, for whom the State had to stimulate the private sector and, if necessary, complete it. All governments launched a policy of economic expansion hoping to achieve general welfare in the framework of a mixed economy.

Growth acceleration

The speed of growth was not the same for all European countries, but the annual rates of industrial production reached unprecedented levels in the world. These rates were more favorably and evenly distributed in the 1960s than in the 1950s.

The recovery process and its components

Accelerated growth must be interpreted as a vigorous recovery movement. The prolonged stagnation, determined by the global economic crisis and the destructions of the war, had created additional space for European and Japanese economic growth. From the point of view of demand, the delay in relation to the new model of North American welfare offered great possibilities of recovery. Only from 1950 did the necessary conditions begin to exist to approach the North American model: increased wages and salaries, international cooperation among industrialized countries, expansion of markets. Rapid economic growth was essentially due to exports, which is why emphasis was placed on expanding markets. In Japan too, the demand derived from exports was important, but the main role there corresponded to the domestic market. Specific supply factors also created conditions for vigorous growth. The chances of recovery of the labor factor were particularly high and undoubtedly benefited economic growth. Technology also contributed to the recovery process. The war had stimulated technical progress, which although it was destined to the war industry, then this accumulated knowledge was contributed to the process of industrial expansion in a global way.

The dynamics of growth in western countries after the war

Accelerated economic growth, under these conditions, was more than a recovery process. In the postwar period, the activities of the Keynesian state tended strongly to achieve full employment and build a social security system. In addition, a countercyclical fiscal and monetary policy was put into operation by means of which the State could stimulate or contract demand. The strong increase in public spending notably increased both structural and temporary demand. The State also contributed to growth by expanding existing educational systems, both horizontally (possibilities for all) and vertically (improving the quality of work). Both for the unions and for the employers, the system of agreements and economic cooperation was of great importance: The private sector respected the social and wage policy of the unions and they declared themselves in agreement with the investment policies of the companies. Both groups had a common growth strategy through which the ground was paved for faster economic expansion. The investments, in general, were directed towards 3 specific sectors: the industrial sectors closely linked to the welfare state, in the tertiary and even quaternary sector and in new regions or industrial branches. With the general consensus of all sectors, plus state support, entrepreneurs also made investments abroad, thus emerging the type of multinational company.

Growth in the Eastern Bloc countries and in the Third World

Growth in the Soviet Union was attributed to the Stalinist model of industrialization of 1929, based on the principle of primitive accumulation. The imperative central planning proposed to invest most of the surplus value generated by agriculture in the industry, acquiring the industrial sectors of absolute primacy base. Despite the fact that in 1979 still a third of the population of developing countries lived in absolute poverty and obtained incomes below the minimum survival, it cannot be denied that both agricultural and industrial production in the Third World have experienced a great increase. process. The State plays a driving role in the Third World, already at the earliest age of economic development. It had to be concerned, from the beginning, with the public good and economic expansion: with a modern transport and communications infrastructure, with a complete and fully effective educational system, and with other public goods. These characteristics contribute precisely to the reason why authoritarian types of government appeared attractive in these countries. The economic development of the Third World also witnessed important structural transformations: urbanization grew rapidly, the proportion of the agricultural sector in the domestic product decreased in parallel with that of the agricultural workforce in the total of assets, while the proportion corresponding to industrial production and industrial workers. In contrast to the European industrialization of the 19th century, in many countries industrialization was an island within a context of agrarian backwardness, it was not a natural or complementary process. Modern models coexist with traditional models, representing a dual society. In general, developing countries that have pursued an export-based growth policy have been much more successful than those that have tried to achieve their industrialization through import substitution. In the same way that the 1950s and 1960s were favorable for the economic growth of the Third World, in the difficult 1970s it was often problematic to continue to put earlier conceptions of the development process into practice.

Europe: from the economic cycle to the growth cycle

The 1950s and 1960s were characterized in the West not only by an acceleration of economic growth, but also by a marked stability of that same growth. In Europe, the development of the situation was favorable between 1945 and 1970, but suffered some cycles of recession. In 1951/52, industrial production fell again, affecting all countries, including the United States. This recession was related to the cycle of inventories and to restrictive government measures aimed at cleaning up the balance of payments, but essentially it was a reaction to the speculative fever unleashed by the outbreak of the Korean conflict (1950) and by the fear of a third world war. During the political crisis, the prices of goods had risen sharply. Many governments imposed restrictions on imports and some even a general restriction policy. These measures led to stagnation and falling prices. The recession could only end when Europe was included in the US (NATO) rearmament program and when governments returned to stimulate the economy.

The second recession was between 1957 and 1958, much milder and shorter than the previous one, but its scope affected not only Europe but also the United States and Japan. It was characterized by the fear of wage inflation due to the fact that the demand for industrial products took such dimensions that all countries, except Italy, approached a situation of full employment, some suffering a notable shortage of workforce. Finally, the rapid success of the Common Market stimulated a European cycle of growth, until 1966 Europe maintained a phase of high conjuncture. The situation of full employment, the high wage inflation derived from it and the increase in prices led to the gradual adoption of new restrictions by the State in 1967.

Growth Cycles in the US and Japan

Their growth cycles did not deviate significantly from the Western European model. Japan suffered a severe recession in 1949 known as the Dodge Recession. The subsequent Japanese recessions, especially those of 1954, 1957/58 and 1962, were related to the cyclical fluctuations observed in the United States, given that Japan based its important export trade in North America at this time. The Japanese conjunctural oscillations show that the gross social product for them grew much less regularly. In the US and Canada the situation evolved after the war even more irregularly than in Japan. The gigantic North American productive apparatus was able to replenish the depleted reserves and to satisfy the increase in consumption in the postwar period with such rapidity that symptoms of saturation appeared already in 1948. The recession was not overcome by internal factors, such as the self-purification of the economy itself, but also by external factors. The evolution of the American and Canadian conjuncture between 1955 and 1965 was characterized above all by the existence of a deep gap between potential and realized production, the so-called demand gap (demand slack); this gap in Europe was much smaller. The American demand for investment goods was not great enough for the economy to fully absorb private and public savings. Probably the resignation of North American businessmen to invest in their own country was due to the fact that the investment offered better prospects abroad. On the other hand, a growing deficit in the US balance of payments was undoubtedly a cause for concern. The whole system was based on the gold convertibility of the dollar and the confidence of this had to be maintained at all costs. Keynesian principles increasingly permeated the conjunctural politics practiced by the Kennedy administration. Economic growth became an important objective for the new administration, which was willing to intervene to bring effective production as close as possible to the real production capacity of the country and it was thought that such a growth policy could only be done. made through considerable budget deficits and internal money creation. This caused a strong inflation that even in 1970, it continued without being reduced and at