Major Changes in the Global Economy Since 1945
In the second half of the 20th century and the 21st century, the world has seen unprecedented economic growth. Since the end of World War II, there has been a stable economy in the world free from world wars. Before these periods, the first and second world war had disrupted the economy. Little progress made over the first four decades was marred with instability to spur growth and development. Nevertheless, the events of the post-war period were critical to the global economy. The formation of development institutions such as the World Bank and the International Monetary Fund had a critical impact on the world economy (text, p. 225). Although the growth was not steady, there was a significant change in the world economy’s view in the post-war period. Although the progress to this is owed to the industrial revolution that graced Europe between the 16th and 19th centuries, the world economy’s view changed. The rise of superpowers came to light during the postwar years, and this has seen more scientific and technological involvement to date. During the Golden Age in economic prowess and capitalism, the progress made the Golden Age played key roles in the global economy. Nevertheless, at the same time, the fight between communism and capitalism shaped the global economy. The economic differences between the United States and the Soviet Union prompted the Cold War. I the end, Globalization was initiated, and the global economy’s view was brought together by more trade and flow of information across the world. Although the industrial revolution was critical times in the global economy through spurring technology and science, the post-war period has seen more economic changes than in the previous decades.
Cold War Era
World War II had a significant impact on military proficiency, economic growth, and political consequences. The first of such was the inception of the cold war, which involved allied powers. In Europe, the Soviet Union was established as a great and significant powerhouse in Europe’s heart. The rise of the Soviet Union to power and dominance was the impact of World War II, which gave rise to the new world order. This was one of the many impacts of growth in international relations and the individual countries’ foreign policy that boosted some nations’ economic growth. The division in Europe involved countries allied to communist Russia and those centered on American capitalism ideology. When Churchill Winston appeared in the United States, he lamented about what the future holds with the rise of countries allied to Russia’s communism approach in Europe (text, p. 194). During the Cold war, the majority of countries in Europe have to gain democracy except aligned with the communist rule. However, the west was motivated to protect the UNO objectives and prevent future wars and ensure stability in the world.
In the EastEast, the Cold war was taking become more imminent as Communist gained victory in China in 1949. Further, the Korean War of 1950-53 significantly extended the cold war from Europe to the EastEast. The capitalist nations joined hands to establish themselves as dominant in a world where the Soviet Union communism approach had gained popularity in much of central and Eastern Europe. For instance, in Poland, Russia was responsible for instituting and leading a government. This indicated the indications of Russia in spreading Communism across Europe. The politics and economy of these countries were aligned along these lines, but politics played little influence in the preceding years. Instead, the countries were concerned about economic prosperity. In the end, the cold war enabled countries like the United States to maintain world order and peace since the debate on mass destruction had ensued. The Soviet Union and the United States were the two superpowers that threatened to initiate a third world war with their prowess in military power and weapons.
European Progress during the Golden Age
Europe was among the biggest beneficiary of the new world order created in the post-war period. Notably, 1945 was a jumping-off point for the majority of the European economic giants. Before the post-war period, the European economy was viable to rapid economic growth through post-war repair. Besides, the continent was able to incorporate men involved in the war into the job market during the peaceful years. Through this strategy, the continent managed to rebuild its capital. Further, the technology invented during World War I and II, which were barely implemented, was initiated during the post-war decades. Europe was the heart of the Industrial Revolution, which gave rise to modern technology and scientific inventions. During the post-war years, with stability attain in the world, Europe saw the development of Lucite, Teflon, and nylon, which become crucial materials in the post-war period (New York Times, The European Economy Since 1945).
The Golden Age also introduced an internal combustion engine that could spur growth in the post-war developments. Although most of the inventions initiated in Europe were developed in the United States, the war’s disruptions prompted a potential delay in the introduction of these technologies and discoveries in the other regions. Nevertheless, Europe was quick to incorporate these new inventions in their growth strategy. Furthermore, the United States had formulated the strategy for mass production and modern management style. When these procedures were licensed in Europe, they oversee a quarter decade of growth that had not been precedent before 1945.
Global Civilization
Global civilization and decolonization took place in the post-war period. During the cold war period, a lot of countries were delivered by the impact of colonization. In some cases, there were instances of terrorism that were either justified in one way or the other. For instance, during the communist era in Europe, some countries were beneficiaries of billions of dollar resources through capital ownership. However, the capital revolved around the world in digital currency. Vaclav Havel, who oversaw the collapse of the former Czechoslovakia communist government and rose to become the president, had his take on global civilization. Although he contributed to the Czech Republic’s introduction in the European Union in 2004, he felt that global civilization was harmful to society (text, p. 222). Nevertheless, he acknowledged that production methods had moved from the traditionally wealthy nation left to control capital.
However, global politics had changed to include global institutions are the determinants of the global economy. Nigel Farage blamed Britain’s presence in the European Union as the source of problems experienced by Great Britain. In his views, the European Commission had managed to drive millions of people into poverty. The theory of nationalism had failed and recommended that the commission ought to be stopped (text, p. 224). Global institutions gained momentum after the end of the Second World War. Institutions such as UNO, IMF, and World Bank were formed. Although Havel and Farage have different political stands, they have undermined global civilization’s progress in promoting growth. In Europe, Brussels was critical to determine the progress of the European Union. This may have influenced the UK’s impact in the European Union since the script has changed in the 21st century. Britain is in line to opt-out of the European Union through what has been widely called Brexit.
Capitalism
As the world was moving away from the war-torn years, capitalism was quickly taking over me most regions in the world. As the world becomes more stable in the last quarter of the 20th century and the first two decades of the 21st century, capitalism was taking over the globe. However, capitalism is entangled on growth, accumulation, and investments, made with a future that the future will be good (the Guardian, Globalization). Although the future is not certain, capitalism is based on the uncertainty of the future. Further, the capitalist market is based on creative destruction, change, or disruption that will impact the investment made over a while. Although criticized over the years, capitalism is said to take a more significant step and impact on the world economy in the coming years.
Capitalism has taken a new look and expanded in both geographical coverage and the scope of accessing new markets in the 21st century (The Guardian, Economics, The crisis of capitalism is not the one Europeans think it is). The new-look of capitalism is entailed in politics, which was associated with the less developed countries in the last century. Surprisingly, communist countries have turned to capitalist, and the composition of the economy has gradually changed. A notable change is a shift in the concentration of the labor force. In Sweden, 7)0% of the workforce is in the private sector. Similarly, in the United States, the sector is responsible for 85% of employment. In China, one of the fastest-growing economies in the world, the private sector, which is largely capitalist, is responsible for 80% of value addition in the Asian country.
Nevertheless, capitalism has changed the global economy over the years. For instance, capitalism has changed the global economy to rely on forecasting. Reeves claims that capitalism was the inception was science fiction as experts tried to explore the future, making critical forecasting about the nature of the economy in the future (The Guardian, Broken Capitalism, Capitalism used to promise a better future. can it still do that?). Modern capitalism has been hailed to have problems related to management. A critical approach addressed this via the recent experiences at Boeing. Capitalism was lamented to have failed to deliver goods that can work (The Guardian, Broken Capitalism, Boeing travails show what’s wrong with modern capitalism). This came after the company experienced rapid growth, followed by a series of crashes that almost ruined the company’s reputation. The fight between capitalism and communism prompted the Cold War’s inception between the United States and the Soviet Union (lecture, p.). So once allies became enemies and capitalism appeared to have won in the end since in the last decade of the 20th century and the 21st century, capitalism has reigned.
Globalization
Despite a score of changes that have happened since the end of World War II, nothing has surpassed Globalization. Globalization describes the relationship between different aspects that have boosted the cross-border trade and the flow of goods and services in the post-war world. Trade has significantly increased in scope through the flow of goods, ease of exchange, and investments flow. Today people no longer have to work in their country of origin. Based on the text, the 1944 Bretton Woods Conference was the global economy’s future (text, p. 225). One of the critical aspects of Globalization was the introduction of free trade. Globalization caused more impact on the global economy through trade. For instance, while countries enjoyed free trade agreements with their key trade partners, the population has started to view the great impact of Globalization. Globalization has made the world appear as a global village where everything is spreading without time zones or boundaries (text, p. 226). The world has achieved to move information, technology, capital people, and knowledge within the world thanks to the impact of Globalization.
Globalization enabled countries to enter into trade agreements where good could flow and services offered under the agreement’s conditions. In the end, Globalization managed to job losses, low wages, and a significant impact on the majority of the population who once believed in Globalization (The Guardian, Globalization: the rise and fall of an idea that swept the world). Similar sentiments were made by Sri Mulyani Indrawati when she focused on the views of global progress and civilization. Generations will feel the impact of civilization different. However, the focus of human beings remains prosperity and the need for equal opportunities. Despite the great access to information and the impact of Globalization, it has remained a challenged to accept the best information, knowledge and incorporate the impact of Globalization the society (text. P. 226). Hence, Globalization has brought critical changes in the global economy and also influenced the view of how information, technology, goods, and services are hared globally.
Conclusion
Despite witnessing the previous impact of economic growth, the four decades of the 20th century were marred with wars that affected the global economy. However, the post-war period so progress as countries embraced peace and the need to abide by UNO’s provisions. During the Golden Age, Europeans thrived through inventions discovered during both World War I and II. During the Cold War, as the United States became enemies, capitalism and communism faced off. However, politics have also shaped the global economy through the formation of global institutions. Although capitalism thrived in the last century, it has been lamented in recent years. Similar experiences have Globalization, which was the turning point of the global economy. Globalization offered room for free trade, which later ruined the economy. While some people benefit from the same, the loss of a job and low wages were some of the critical impacts of Globalization. Nevertheless, Globalization has had a tremendous impact on the global economy by boosting trade, the flow of information, and capital circulation. The current generation boosts the presence of information but to decide the best decisions from the available information.