Economic Responses: c. 1900 - Present

AP Concept: 6.3 New Conceptualizations of Global Economy and Culture
Key Concepts
  • States responded in a variety of ways to economic challenges
  • Several nations turned to communism in response to the economic challenges facing nations in the 20th century, hoping that collectivizing industry and agriculture would increase productivity
  • These nations pushed their people to industrialize and modernize rapidly, with limited success
    • Russia underwent two economic revolutions following the fall of the czar in 1917
    • The New Economic Policy of 1921 (NEP) instituted by Vladimir Lenin allowed peasants to sell products, while the government controlled banking, trade, and heavy industry
    • Joseph Stalin's Five-Year-Plans took over the NEP when Lenin died in 1924; under the plans, farms were collectivized, and those who refused were put to death
    • Agricultural productivity actually declined, and it was not until the Great Depression hit Western Europe and the United States that Russia's industrial productivity increased
    • China underwent an economic revolution as Mao Zedong attempted to modernize the country in order to equal the output of Western countries
    • The Great Leap Forward aimed to collectivize agricultural and industrial production, as well as individual family life
    • The government inflated initial production statistics, and bad weather and declining food production led to the deaths of at least 16 million people
  • At the end of WWII, Japan was devastated by the nuclear attacks on Hiroshima and Nagasaki, and the Allies put together an administration to restore Japan's economy and infrastructure
  • Allies hoped to make Japan strong enough to defend against communism in East Asia
  • Allied administration occupied Japan and instituted a constitution, land reforms, and an education system
  • The United States formed a defensive alliance with Japan, which allowed Japan to spend less than 1% of its GDP on self-defense
  • This financial ease allowed Japan to develop an export economy focusing on technology Japan's economy recovered tremendously quickly from WWII

Related Links:
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Restructuring of States: c. 1900 - Present

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