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The role of Government policies in economic change, 1871-1990 (Membership…
The role of Government policies in economic change, 1871-1990
Bismarck, 1871-1890
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Introduction of protection, 1879
1879 ditched Liberals and free trade. Aligned with Conservatives he supported the introduction of protective tariffs
Several reasons for this
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France, Russia, Austria adopted tariffs
German agriculture suffered from the importation of cheap wheat from the USA and Russia. Bismarck feared Germany reliant on foreign grain
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Higher tariffs meant higher bread prices, they protected German jobs
Wilhelmine Germany, 1890-1918
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FWW
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Govt Intervention: tried to ensure all contributed to WW1. War Ministry decided all men should be conscripted . 13 million called for service, a 5th of the population. Women were used in the workforce to substitute for men.
The War Raw Materials: exercised vast power directing labour, controlling the railways, introducing rationing and price controls and allocating resources to industries. The Auxiliary Services Act 1916 enabled the government to control labour of males 16-60. Germany still behind British production
Civilian morale- lack of food and fuel made life miserable. workers resented being forced to work long hours. Nov 1918, revolution broke out
Weimar Republic, 1919-1933
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Nazi economics, 1933-39
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Nazi war economy
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Hitler initially rejected a total war economy-e.g. rationing, limitation on consumer goods, as concerned for morale.
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1943 Goebbels called on self sacrifice to support total war to halt annihilation. While war production trebled between 1942-44. German productivity lower than that of the Allies.
Germany 1945-90
Marshall Plan
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US Sec of state George Marshall announced USA would provide economic aid to Europe. FRG recieved 1.5 billion
Currency reform- introduced the Deutschmark. USSR's opposition to this led to the Berlin Blockade and the Allied airlifts.
Erhard
Economics minister - stripped away Nazi and Allied economic replaced with Free and Social Market- govt provided welfare to help vulnerable.
The Stabilisation LAW
1967 new Economics Minister Schiller supported the Law- gave the FRG the power to control economy in recession
Membership of the EEC
Began in 1951 with trade restrictions on coal and steel were dropped between Belgium, France, Italy, Luxembourg, the Netherlands and the FRG (the Six). Integration stepped forward as a result of the Treaty of Rome (1957) by which the 6 formed the EEC.
Benefits were: cheaper products through elimination of trade barriers.
savings achieved through common policies of agriculture and transport
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Later adopted a common currency and political union creating a single European State- although little progress pre-1990
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Kohl later privatised companies such as Lufthansa and VW as a way to reduce the states role in the economy