what caused the economic depression after world war 1
Depression of 1920–21 There was a brief post–World War I recession immediately following the end of the war which lasted for 2 years, complicating the absorption of millions of veterans into the economy. The economy started to grow, though it had not yet completed all the adjustments in shifting from a wartime to a peacetime economy. Factors identified as contributing to the downturn include: returning troops which created a surge in the civilian labor force and problems in absorbing the veterans, a decline in labor union strife, changes in fiscal and monetary policy, and changes in price expectations.
Economic history of World War I The Allies had much more potential wealth they could spend on the war. One estimate (using 1913 US dollars) is that the Allies spent $147 billion on the war and the Central Powers only $61 billion. Among the Allies, Britain and its Empire spent $47 billion and the U.S. $27 billion (America joined after the war started) while among the Central Powers, Germany spent $45 billion.[2]