# What Economic Interdependence of Europe means in The Economic Consequences of the Peace

> Keynes argues that pre-war Europe was a delicate, interconnected economic system where the prosperity of each nation depended on the others, and that the Treaty of Versailles destroyed this system by crippling Germany, the continent's industrial heart.

## Explanation

Keynes argues that pre-war Europe was a delicate, interconnected economic system where the prosperity of each nation depended on the others, and that the Treaty of Versailles destroyed this system by crippling Germany, the continent's industrial heart.

Keynes details how Germany's trade and capital investments tied the continent together, with Germany as the best customer and supplier for many nations.

Germany's transformation into an industrial machine dependent on external factors for subsistence illustrates the deep economic interdependence of pre-war Europe.

The chapter details how Germany's economy was intertwined with its neighbors through trade, capital investment, and organization, making the whole European system dependent on German prosperity.

Europe's pre-war prosperity depended on capital exports to the New World and cheap food imports, creating a fragile equilibrium.

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