{"id":1977,"date":"2018-01-21T11:55:15","date_gmt":"2018-01-21T11:55:15","guid":{"rendered":"http:\/\/schoolshistory.org.uk\/topics\/?page_id=1977"},"modified":"2026-05-06T16:37:27","modified_gmt":"2026-05-06T16:37:27","slug":"reparations","status":"publish","type":"page","link":"https:\/\/schoolshistory.org.uk\/topics\/european-history\/weimar-nazi-germany\/reparations\/","title":{"rendered":"Reparations and the German Post War Economy"},"content":{"rendered":"

Reparation payments by Germany were included in the terms of the Treaty of Versailles.<\/a> They required Germany to pay for the cost of the damage done by the war. Figures set after the Treaty of Versailles initially set out a figure of 132 Billion German Gold Marks. This amount was later reduced. The amount in British Pounds equates to \u00a36.6 Billion. Some reparations were paid via goods taken, and across the period 1919-1933 the German economy paid some 21 Billion German Marks: often using foreign loans. German Reparation payments were a consequence of the ‘War Guilt’ clause of the Treaty of Versailles. Once in power, Adolf Hitler and the Nazi Party<\/a> halted German payments of reparations.\u00a0<\/strong><\/p>\n

Reparations payments and the German Economy<\/h3>\n

Reparations repayments contributed to the German economy becoming devalued. Having to pay such large sums to the Allies resulted in the German economy having a rapidly reduced capacity to purchase goods, as they were compelled to give much of their accumulated wealth and produce to the Allies in part payment towards the Reparations bill. The level of reparations Germany had to pay was set out in the Treaty of Versailles<\/a>.<\/p>\n

\"Reparations
An American cartoon depicting the burden of war reparations on Germany. \u00a9 New York World 1921, via Wikimedia Commons.<\/figcaption><\/figure>\n

Consequences of Reparation Payments for Germany<\/h2>\n

This had several consequences. First, it resulted in the value of the German currency falling. Second, it resulted in the cost of items within Germany rising as the relative cost of importation rose as the value of the currency declined. This is inflationary in nature and has several consequences. In situations such as this people make use of their savings, as they cannot afford to make purchases using only their weekly or monthly income. In Germany billions of dollars worth of hoarded and saved marks re-entered the economy in the period after the war. Again, this results in inflation rising and the value of the currency falling when compared to other currencies. Combined, these factors lead to a cycle of devaluation and inflation that can, and did, become hyperinflation<\/a>.<\/p>\n

It is not however the case that the economy within Germany continued to decline throughout the whole of the period 1919 \u2013 1923. In 1920 the currency stabilised for a period of some 6 months. The price index remained almost constant and the value of the German mark remained at approximately 1US$ to 69 German marks. The Weimar Government<\/a>, it has been argued, could have introduced a stable currency at this point. Instead they continued to increase the amount of money in circulation \u2013 which is inflationary. The result was hyperinflation in 1923. This had massive consequences for the economy and society in general.<\/p>\n

http:\/\/www.usagold.com\/GermanNightmare.html<\/a><\/p>\n

This link includes an outline of how peoples investments were affected during this era. It notes that in general people would have lost the value of their investments \u2013 with one or two areas that proved to be the exception: Investment in Capital (Land and Buildings) and Investment in Foreign currency.<\/p>\n

Germany 1919 – 1945 Links<\/h2>\n

The Second Reich<\/h3>\n

Unification of Germany<\/a> – Political systems within the Second Reich<\/a> – German Society during the Second Reich<\/a> – Collapse of the Second Reich<\/a><\/p>\n

Weimar Republic<\/h3>\n

Interim Government<\/a> –\u00a0Founding of the Weimar Republic<\/a> –\u00a0Impact of the First World War on Germany<\/a> –\u00a0The Treaty of Versailles and its impact on Germany<\/a> –\u00a0Weimar Constitution<\/a> –\u00a01919-1923: Years of Crisis?<\/a> –\u00a0Spartacist Uprising<\/a> –\u00a0Kapp Putsch<\/a> – Reichsbanner Schwarz-Rot-Gold<\/a> – Reparations<\/a> –\u00a0Hyperinflation in Germany, 1923<\/a> –\u00a01924-1928: A Golden Era?<\/a> – 1925 Presidential Election<\/a> – Gustav Stresemann<\/a> –\u00a0German Foreign Relations 1919-1932<\/a> –\u00a0Germany in the Great Depression<\/a> \u00a0–\u00a0Failings of the Weimar Republic<\/a> – Dada Movement<\/a><\/p>\n

Rise of the Nazi Party<\/h3>\n

The Munich Putsch<\/a> –\u00a0Did the Economic Crisis of 1923 help the Nazi’s?<\/a> –\u00a0Origins of the Nazi Party<\/a> –\u00a0Rise of the Nazi Party<\/a><\/p>\n

Nazi Germany<\/h3>\n

Totalitarian Regime in Nazi Germany<\/a> –\u00a0How did Hitler consolidate power?<\/a> –\u00a0Mein Kampf<\/a> –\u00a0Nazi methods of control<\/a> –\u00a0Opposition to the Nazi Regime<\/a> –\u00a0Organisation of the Nazi Party<\/a> –\u00a0Fuhrerprinzip<\/a> –\u00a0Kristallnacht<\/a> –\u00a0Youth and Education<\/a> –\u00a0Goering and the 2nd 4 Year Plan<\/a> –\u00a0Anti-Jewish Boycott, 1933<\/a> –\u00a0Nazi Anti-Semitism<\/a> –\u00a0DAF (The German Labour Front)<\/a> –\u00a0Propaganda in Germany 1919-39<\/a> –\u00a0Economic Policy of the Nazi Party<\/a> – Kreisau Circle<\/a> – The Confessing Church<\/a> – Catholic Church<\/a> – Edelweiss Pirates<\/a><\/p>\n

Biographies<\/h3>\n

Ludwig Beck<\/a> – Dietrich Bonhoeffer<\/a> – Bishop Clemens von Galen<\/a> – Carl Goerdeler<\/a> – Robert Ley<\/a> – Helmuth von Moltke<\/a> – Martin Niemoller<\/a> – Erwin Rommel<\/a>\u00a0– Hjalmar Schacht<\/a> – Sophie Scholl<\/a> – Albert Speer<\/a> – Claus von Stauffenberg<\/a> –\u00a0Fritz Todt<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Reparation payments by Germany were included in the terms of the Treaty of Versailles. They required Germany to pay for the cost of the damage done by the war. Figures set after the Treaty of Versailles initially set out a figure of 132 Billion German Gold Marks. This amount was later reduced. The amount in… <\/p>\n","protected":false},"author":1,"featured_media":0,"parent":13,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"neve_meta_sidebar":"","neve_meta_container":"full-width","neve_meta_enable_content_width":"off","neve_meta_content_width":100,"neve_meta_title_alignment":"","neve_meta_author_avatar":"","neve_post_elements_order":"","neve_meta_disable_header":"","neve_meta_disable_footer":"","neve_meta_disable_title":"","footnotes":""},"class_list":["post-1977","page","type-page","status-publish","hentry"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/schoolshistory.org.uk\/topics\/wp-json\/wp\/v2\/pages\/1977","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/schoolshistory.org.uk\/topics\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/schoolshistory.org.uk\/topics\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/schoolshistory.org.uk\/topics\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/schoolshistory.org.uk\/topics\/wp-json\/wp\/v2\/comments?post=1977"}],"version-history":[{"count":0,"href":"https:\/\/schoolshistory.org.uk\/topics\/wp-json\/wp\/v2\/pages\/1977\/revisions"}],"up":[{"embeddable":true,"href":"https:\/\/schoolshistory.org.uk\/topics\/wp-json\/wp\/v2\/pages\/13"}],"wp:attachment":[{"href":"https:\/\/schoolshistory.org.uk\/topics\/wp-json\/wp\/v2\/media?parent=1977"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}