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Germany and West Germany, 1918–89

Creating a social market economy, 1945–89

  • 3 things to know
  • Paper 1

Overview

Recall questions on the currency reform of 1948, codetermination, the causes of the economic miracle, the 1966 recession, and the oil shocks.

What you need to know

Answer each one before you reveal it.

Your recallNot started
Numbers

How did the Marshall Plan help West Germany?

Key term

What is a social market economy?

Numbers

What economic shock hit the Federal Republic in the 1970s?

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    How did the Marshall Plan help West Germany?

    Model answer

    American aid from 1948 provided funds and confidence to rebuild the shattered economy.

  2. 2

    What economic shock hit the Federal Republic in the 1970s?

    Model answer

    The 1973 oil crisis, which brought recession, inflation and rising unemployment.

  3. 3

    What was the 'economic miracle' (Wirtschaftswunder)?

    Model answer

    West Germany's rapid economic growth from the 1950s under Erhard's policies.

  4. 4

    What is a social market economy?

    Model answer

    Erhard's model of free markets and competition combined with a strong welfare state and codetermination, avoiding both central planning and unregulated capitalism.

  5. 5

    What was the currency reform of 1948?

    Model answer

    The replacement of the Reichsmark by the Deutsche Mark, which ended the black market overnight and, with the lifting of price controls, restarted normal trade.

  6. 6

    What was codetermination?

    Model answer

    Worker representation on company supervisory boards and works councils, which gave labour a voice in management and contributed to low levels of industrial conflict.

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AThe government admitted 96 dead and 333 wounded.
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COpponents claimed thousands.

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