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How does war help the economy?

Updated: 8/23/2023
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14y ago

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Total war affects countries politically, socially, and economically. Economically, usually foods and products made in the country are rationed and used to make materials for war. Also, wages are controlled by the government, and there is usually a need for more work/ Politically, the leaders of the country will try to enforce the war effort to build up nationalism. This can be done through the use of Propaganda. Governments will also use censorship to block the treasonous from corrupting the people of the war effort. Socially, the people of the nation will become more equal, as many are brought together to help out the country in the work that they do.

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Annamarie Trantow

Lvl 10
2y ago
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14y ago

In times of war manufacturing is usually increased, so defense contractors, and other contractors can create jobs, and make money. In addition the soldiers are employed by the government so it can help decrease unemployment.

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13y ago

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Raw materials and factories will be turned over to manufacturing war goods (tanks, uniforms etc.) thus reducing the production of consumer goods. Shortages can lead to rationing and the rise of the black market. Shortages generally drive up prices.

Foreign trade is likely to be disrupted. Other countries may choose to suspend trade, imports of 'luxuries' will slow down as priority is given to importing raw materials or military equipment. Trading ships may be sunk by the enemy.

If conscription is imposed there will be a knock-on effect on the labour market

Depending on how the war is going, there may be a loss of confidence in the Stock Market.

The government will have to pay the cost of the war - either through borrowing or taxation.

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