Economy in the Interwar Period

Not long after the global trauma of World War I, a global economic crisis

resulted in the Great Depression of the 1930s and eventually led to World War II. It undermined faith in the market-based economics that had delivered such wealth as imperialism spread. As unemployment, hunger, and homelessness increased, people turned to their governments for help. Governments had long been essential to capitalism—building roads, providing schools, and regulating trade—but across the world in the 1930s, government intervention in the economy increased. The United States became more liberal as President Roosevelt identified inequities and activities that undermined the economy and could lead to war. Countries such as Germany, Italy, and Japan, however, turned radically to the right. In Russia, government economic control was instituted through the implementation of often repressive Five-Year Plans based on production quotas.