By the way, although WWII raised U.S. real GDP a lot, this response is not typical for the OECD. If fact, WWII is the biggest economic disaster of the 20th century, out-stripping the Great Depression. This is, of course, because many countries suffered greatly from physical destruction and loss of life (the U.K. not nearly as much as many countries on the European continent).
This is from an exchange with Clive Crook regarding the debate over the fiscal stimulus … does Henry Hazlitt work at Harvard?
Russ Roberts noted on some talk show that WWII might have increased US real GDP, but it was because of increased industrial output of tanks and bullets and planes….”goods” that don’t exactly raise the quality of life for the producer (and tend to decrease the quality of life pretty drastically for the consumer)!
What we weren’t producing in large volume were refrigerators and TVs and other things that make life a little easier…check FRED – output of consumer goods shrank in ’42 and ’43, and was middling in ’44 and ’45
Probably Japan lost worst of all in WWII. Our firebombs wiped out more stuff than the atmoics even did. Basically every Japanese city was entirely destroyed. Ever seen the movie “The Fog of War”?
Don’t know how that compares to the destruction in Europe really. *shrug*
He makes a good point though that I wouldn’t have thought of. Seems obvious in hindsight though that bullets don’t help much with standard of living!