The economy experienced real GDP growth of over 11% in 1951 with inflation increasing to 5.3% in
1951. The government then resorted to price and wage controls in an attempt to control inflation.
Notably, the year after the conflict ended, 1954, there was a short recession in spite of the fact
military outlays still constituted 13% of GDP. National GDP fell to be effectively the same as it had
been two years prior, in the middle of the war in 1952.
Material well-being was affected by tax increases, new price and wage controls which constrained
private sector consumption and investment. However, perhaps of more impact to the U.S.
economy over the ensuing years was that two of the key components of GDP, consumption and
investment, did not return to their pre-war trends.
1951. The government then resorted to price and wage controls in an attempt to control inflation.
Notably, the year after the conflict ended, 1954, there was a short recession in spite of the fact
military outlays still constituted 13% of GDP. National GDP fell to be effectively the same as it had
been two years prior, in the middle of the war in 1952.
Material well-being was affected by tax increases, new price and wage controls which constrained
private sector consumption and investment. However, perhaps of more impact to the U.S.
economy over the ensuing years was that two of the key components of GDP, consumption and
investment, did not return to their pre-war trends.
