How do wars raise economic prosperity?
I know wars are profitable but i just dont understand how. I know WW2 got us out of the depression and i know the the Iraq war is one of the first that we actually lost money. So i just what to know exactly how war makes money?
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A war is technically an increase in Aggregate demand. If aggregate demand increases, we increase our output, which causes us to spend more money. Spending on defense is still spending.