The Japan’s postwar economy developed from the remnants of an industrial infrastructure that suffered widespread destruction during World War II. In 1952, at the close of the Allied Occupation, Japan was a “less-developed country,” with per capita consumption roughly one fifth that of the United States. Over the following two decades, Japan averaged an annual growth rate of 8 percent, enabling it to become the first country to move from “less developed” to “developed” status in the postwar era. The reasons for this include high rates of both personal savings and private sector facilities investment, a labor force with a strong work ethic, an ample supply of cheap oil, innovative technology, and effective government intervention in private-sector industries. Japan was a major beneficiary of the swift growth attained by the postwar world economy under the principles of free trade advanced by the International Monetary Fund and the General Agreement on Tariffs and Trade, and in 1968 its economy became the world’s second largest, following that of the United States. Between 1950 and 1970, the percentage of Japanese living in cities rose from 38 percent to 72 percent, swelling the industrial work force. Source: Web-Japan, Ministry of Foreign Affairs, JapanThe competitive strength of Japanese industry increased steadily, with exports growing, on average, 18.4 percent per year during the 1960s.
For the United States, World War II and the Great Depression constituted the most. The federal government emerged from the war as a potent economic actor, able to. As Table 2 shows, output in many American manufacturing sectors. The Postwar Economy: 1945-1960 As the Cold War unfolded in the decade and a half after World War II, the United States experienced phenomenal economic growth. The war brought the return of prosperity, and in the postwar period the United States consolidated its position as the world's richest country.
After the mid-1960s, a current account balance surplus was achieved every year except for a couple years following the oil crisis of 1973. The economic growth in this era, supported by strong private-sector facilities investment based on a high personal savings ratio, was accompanied by significant changes in Japan’s industrial structure. Whereas formerly the mainstays of the economy were agriculture and light manufacturing, the focus shifted to heavy industry. Iron and steel, shipbuilding, machine tools, motor vehicles, and electronic devices came to dominate the industrial sector.
In December 1960, Prime Minister Ikeda Hayato announced an income-doubling plan which set a goal of 7.8 percent annual growth during the decade of 1961-1970. Government economic planning aimed at expansion of the industrial base proved exceedingly successful, and by 1968 national income had doubled, achieving an average annual growth rate of 10 percent. IbidThroughout the postwar period, Japan's economy continued to boom, with results far outstripping expectations.
Japan rapidly caught up with the West in foreign trade, gross national product (GNP), and general quality of life. These achievements were underscored by the 1964 Tokyo Olympic Games and the Osaka International Exposition (Expo '70) world's fair in 1970. Source: Library of CongressIn his 1979 book Japan as Number One Harvard’s Ezra Vogel proclaimed that “Japan has dealt more successfully with more of the basic problems of post-industrial society than any other country.” Perry Anderson wrote in the London Review of Books, “The Japanese themselves, he said, had been too modest about their achievements. It was time they realised that in the overall effectiveness of their institutions, they were ‘indisputably number one’ and time too that Americans woke up to the fact, and put their own house in order.
Post-bubble, the book is no doubt remaindered in Japan. But at the time, Vogel’s flattery electrified sales.” Source: Perry Anderson, London Review of Books, February 9, 2012Websites and ResourcesGood Websites and Sources on Post-War Japan.
Looking around at the magnitude of death and destruction that resulted from the World War I, leaders of the some of the world’s major powers convened a conference in Paris, the outcome of which they hoped would ensure that no such devastation would ever happen again. Unfortunately, the combination of a poorly designed peace treaty and the most severe economic crisis the modern world had ever experienced brought about a deterioration of international relations that would culminate in a war even more calamitous than the one that preceded it. The unfortunate irony of the Paris Peace Conference that begat the Treaty of Versailles was that, despite its authors’ best intentions to ensure a world of peace, the treaty contained a seed that when sown in the soil of economic crisis would give rise, not to peace, but to war. That seed was Article 231, which with its label “the war guilt clause” placed sole blame for the war on Germany and its need to make reparations payments as punishment.
With such extensive reparations payments, Germany was forced to surrender of colonial territories and military disarmament, and Germans were naturally resentful of the treaty. As early as 1923, the newly constituted Weimar Republic began delaying payments on war reparations, which initiated a retaliatory response by France and Belgium. Both countries would send troops to occupy the industrial center of the Ruhr River valley region effectively appropriating the coal and metal production that took place there. As much of German manufacturing was dependent on coal and metal, the loss of these industries created a negative leading to a severe.
This contraction, as well as the government’s continued printing of money to pay internal war debts, generated spiraling. While price and economic stabilization would eventually be achieved – partly through the help of the American Dawes plan of 1924 – the hyperinflation wiped out much of the life savings of the. The political consequences would be devastating as many people became distrustful of the Weimar government, a government that had been founded on liberal-democratic principles. This distrust, along with resentment over the Treaty of Versailles, lent itself to the increasing popularity of more left and right-wing radical political parties. The onset of the would serve to undermine any attempts at creating a more open, cooperative and peaceful post-war world.
The American stock market crash in 1929 caused not just a cessation of loans provided to Germany under the Dawes Plan, but a complete recall of previous loans. The tightening of money and credit eventually led to the collapse of Austria’s largest bank in 1931, the Kreditanstalt, which kicked off a wave of bank failures throughout Central Europe, including the complete disintegration of Germany’s banking system. Despite noble aspirations for peace, the outcome of the Paris Peace Conference did more to reinforce hostility by singling out Germany as the sole instigator of the First World War. The Great Depression and the economic protectionism it engendered would then serve as the catalyst for the hostility to manifest itself in the rise of the Nazi Party and increasing imperialist ambitions among world nations. It was then only a matter of time before small imperialist conquests would lead to the breakout of World War II.