eichengreen166_Scott PetersonGetty Images_ukraine destruction Scott Peterson/Getty Images

Shaping a Marshall Plan for Ukraine

The postwar Marshall Plan provided Europe with the finance not only to rebuild itself, but also to leapfrog a generation technologically. Ukraine’s reconstruction offers a similar opportunity, but only if the most relevant features of the Marshall Plan are fully appreciated.

BERKELEY – Talking up a Marshall Plan for Ukraine is a popular sport nowadays. The game starts by tossing out a figure for the cost of reconstructing Ukraine from the ravages of the Russian invasion – $250 billion, or $500 billion, or $1 trillion, depending on assumptions about how much is destroyed, the cost of caring for refugees, and so forth. The overall cost of the post-World War II Marshall Plan is then compared with US GDP in 1948, when the program started. This typically leads to the conclusion that the cost of Ukrainian reconstruction relative to the size of the donor countries will be in the same ballpark as the Marshall Plan.