ABSTRACT
The Spanish economy has evolved through three clearly different stages since the end of the Civil War. The first stage, ending in 1959, was characterized by the government’s attempt to achieve nearly complete self-sufficiency. Only critical and non-substitutable imports were allowed to supply the needs of a highly protected domestic industry; these imports were paid for with the earnings of a few Spanish exports. The low purchasing power of the Spanish masses, exclusive production for a narrow domestic market, technological backwardness and little specialization in production resulted in either zero or even negative economic growth in the late 1940s. The pursuit of economic autarky brought the economy close to bankruptcy in the mid-1950s. At a time when the isolated Spanish economy was experiencing rising difficulties, other Western European economies were responding to the promises of policies of a very different orientation. A number of Western European nations were liberalizing their foreign trade and were supporting policies of economic integration; in the 1950s, they had succeeded not only in rebuilding their war-damaged industries, but they had modernized them as well. Spain’s industrial sector was still constituted by small, inefficient private firms and by equally inefficient large national enterprises. The relative deterioration of the Spanish economy in the 1950s forced some of the country’s leaders to conclude that a change in economic policy was imperative.
