Economic Miracle: Germany vs. Brazil

Categories: BrazilGermany

The economic miracle of a country is defined as a duration of substantial economic expansion that is sudden or unanticipated. Both Germany and Brazil’s economic miracles have many similarities, but also various differences as well. The economic miracle of West Germany occurred shortly after World War II, while Brazil’s occurred almost twenty years after. Years of growth continued for Germany, while Brazil suffered economic hardships almost ten years after its economic miracle. Although both economic miracles focused on tax reforms, Germany’s economy highlighted currency reform, while Brazil’s economy centered on foreign investment.

Germany’s economic miracle began just three years after World War II in 1948. The man most accredited with the economic surplus is Ludwig Erhard. Erhard, head of an economic local government of Germany, implemented policies that consisted of issuing tax cuts that were immense, devising a new form of money, and removing price constraints. By executing tax cuts, people would be motivated to invest and spend their money.

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But, with the release of the new currency, all riches that German citizens had were practically gone, as the cash supply was decreased by ninety-three percent. In earlier years, value controls were put into impact by Adolf Hitler with the goal that the legislature could purchase war supplies at modest costs. This led to extreme scarcity and the rise of people producing their own food by farming. By ending price constraints and issuing a new capital, inflation had ended and Germany’s economy quickly restored.

In contrast to Germany’s prosperity being affiliated with one man, Brazil’s economic miracle occurred as a result of the military as a whole.

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In 1964, Brazil’s military took over the government and remained in power for twenty years. The armed forces sought to decrease state control of the economy and emphasize the market forces. Some policies executed by the new regime focused on supporting overseas investment and issuing tax incentives to raise abroad exchange. While Germany’s economic miracle seemed to occur overnight, Brazil’s time of economic prosperity did not take place until years after the new polices were implemented. The gross domestic product of Brazil was raised by almost eleven percent between 1968 and 1974. The development of Brazil’s economy proceeded into the 1970’s. Although Brazil was going through a time of economic success, many mishaps still remained. Many of the citizens of Brazil did not receive the benefits of the country’s new reforms, as the money was unevenly circulated. Eventually, the military’s changes to Brazil’s monetary system led to future inflation and debt during the 1980’s.

In conclusion, both Brazil and West Germany went through a period of time that transferred for their economy in numerous amounts of ways. It could be stated that Germany implemented stronger policies, as its economic miracle took place very quickly and led to increased prosperity over the years. Not only did Brazil suffer shorty after its “economic miracle”, but it was troubled with inflation and roaring debt in the years following. Both West Germany and Brazil received assistance from other countries, particularly the United States, to help build up their economies. West Germany was granted a substantial amount of aid with the Marshall Plan, which was established to help restore European economies after the second World War. Brazil was involved in aid programs such as the International Monetary Fund and Alliance for Progress. The International Monetary Fund sought to encourage global exchange and promote economic growth worldwide. Alliance for Progress was a short-lived organization that was created to defeat the spread of Communism.

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Economic Miracle: Germany vs. Brazil. (2021, Aug 16). Retrieved from

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