ABSTRACT

Despite the Allies’ influence in governing Germany after World War II (1945-55), the German people played a crucial role in the formation of the economic and political system of their country. They accomplished this by successfully developing the model of the social market economy. For Germany, this was a rather unique system, relying on free markets, strong cooperation of employers with workers, and an important role for the government to promote social inclusion to reduce income inequality. This economic system also became known as the Rhineland model of capitalism.1