After World War I, the Allies punished Germany in several ways, including creating difficulties for any economic advancement for the defeated nation. These efforts may have created or at least worsened some of the pressures which would lead later to the onset of another world war. After World War II, treatment of Germany was very different, and Germany responded much as did the other defeated nation, Japan, by building an industrial base and achieving considerable economic growth. The nation was able to sustain this growth and accomplish an economic miracle which continues to this day as Germany has taken a leading economic position among the nations of the unified Economic Union. A number of forces contributed to the economic growth of Germany after the war, beginning with the assistance offered to the defeated nation by the United States and including some economic development in the West as a counter to the Communist system in control of East Germany.
After World War II, the Federal Republic of Germany, also known as West Germany, made a remarkable economic recovery that continues to this day, though progress may have been slowed somewhat by the reunification of Germany in 1990. At the time of reunification, the Federal Republic of Germany was one of the world's strongest economies, and by comparison, the economy of the German Democratic Republic, or East Germany, was in a state of severe decline after forty years of communist-style control. Economic, monetary, and social union took place in July 1990, and at this time all the relevant West German laws were introduced in East Germany and an extensive process of renewal was undertaken. It was believed that a long period of adjustment would need to occur before the enormous economic differences between the eastern and western parts of Germany might be eliminated, with particular concern for eliminating the disparity in levels of salaries and standards of living. In 1992, th...