1. Increase in defense expenditure:
- Government spending on the war effort, including the production of military equipment and supplies, provided a significant boost to industrial output and employment in many countries especially those involved in the production of war machinery.
2. Reallocation of resources:
- The war required a massive reallocation of resources from civilian to military production. This led to shortages of goods and services, resulting in inflation in many countries.
3. Disruption of trade:
- The war disrupted global trade, leading to shortages of raw materials and finished goods. This caused widespread economic disruption in countries that relied on international trade.
4. Infrastructure damage:
- The war caused significant infrastructure damage in many countries, especially in Europe and Asia, which required substantial resources for reconstruction after the war.
5. Economic growth and recovery:
- In the long run, World War 2 contributed to economic growth and recovery in many countries. The war stimulated technological innovation, particularly in the military and industrial sectors, which led to advances that could later be applied in civilian industries.
6. Rise of the United States as an economic superpower:
- The United States emerged from the war as the dominant economic power in the world. The war had significantly increased its industrial capacity and the demand for American goods.
7. Bretton woods system:
- The war led to the creation of the Bretton Woods system, an international monetary system based on the US dollar, which helped stabilize the global economy and trade in the post-war era.
8. Economic hardship:
- The world, particularly Europe and Asia, faced economic hardship and devastation due to the extensive damage and loss of life caused by the war. Rebuilding and recovery efforts took years.
9. Debt and austerity:
- Many countries incurred massive debt during the war, leading to austerity measures and economic challenges in the post-war period.
10. Rise of welfare state:
- After the war, many governments adopted social welfare programs and policies aimed at providing support to citizens, including healthcare and unemployment benefits, to address economic and social needs and prevent economic dislocation.