Lessons Learned? British Mobilization for the Two World Wars

Abstract

We compare the mobilization of the British economy during the two world wars, asking to what extent performance improved in World War II as a result of lessons learned from the experience of World War I. We find that government controls were introduced more quickly and comprehensively in World War II, which improved the scale and speed of mobilization. Better fiscal and financial management also led to less inflation. However, the external account proved more of a problem during World War II, and the greater reliance on planning rather than market mechanisms may have had adverse effects on productivity performance in the postwar world. The setback to national wealth was greater during World War II, but this did not lead to heavier reparation demands, as a result of lessons learned from the Versailles settlement.