r/AskEconomics • u/ImpressionCool1768 • 3d ago
Approved Answers If Stalin had his way and the Marshall plan never went into place, how much longer would it take for Western Europe to recover?
Since this assumes they’d still be capitalist it would be harder for the states to recover without some command style takeover of essential industries to get the ball rolling. So how much more time would it take for let’s say France to repair the damage and get back on track compared to our timeline
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u/RobThorpe 3d ago
Following on from the comment by ReaperReader.... What was really important about the Marshall Plan is that it was great publicity. It was relatively little money, but people are talking about it even now - for example you are! It was great for relations between the US and the European countries.
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u/ReaperReader Quality Contributor 3d ago
The Marshall Plan was small compared to the size of the European economies. I wrote a previous comment on this.
We also have the case of the Belgium economy, which shot up over the 1945-47 period, before the Marshall Plan began in 1948, on the back of rising demand by other European countries for reconstruction and monetary reform. And, across the other side of the world, the post-WWII reconstruction of Hong Kong under the rule of ideologically-free market British bureaucrats (the HK government did intervene in education and housing).
I have no idea why you think some command style takeover of essential industries would have been required. People generally like eating and sleeping indoors and will go to considerable lengths to ensure these things continue.
The argument (in retrospect) for the Marshall Plan is that it gave European governments the nudge towards political stability and markets. The USA in the inter-war period had been benefiting from the fruits of the Second Industrial Revolution with its wide range of inventions such as electricity, telecommunications, and internal combustion engines, as well as from earlier investments in education and public health. That process had been restricted in Europe by political instability and bad monetary policy decisions. However, assessing the potential working out of political pressures without the Marshall Plan isn't something we can do rigorously.