Chapter 5 explores how economic factors played a major role in determining the outcome of this war. An “economic snapshot” shows the impact of the war in every economy using indices of gross domestic product or national income, industrial production, changes in the labor force, food production, and the level of imports and exports for each country. Germany, Austria-Hungary and Russia suffered severe shortages of food and consumer goods and a collapse of international trade. France and Britain used American credit markets to offset these losses by increasing imports. Government military expenditures produced budget deficits that produced an “inflation tax” to pay for the war. The British instituted a naval blockade to cut off trade with Germany. The Germans retaliated with submarine warfare that threatened to sink any ships trading with Germany. The blockades clearly placed an added burden on the domestic economies. On balance the economic war favored the Allies because of their greater access to global trade, and their more sophisticated markets, which made it easier for them to find substitutes for goods eliminated by wartime distruption.