The period between 1950 and 1973, known as the "Golden Age of capitalism" in the west, was the most prosperous period in Europe's modern history. The economic boom in the post-war period saw GDP grow by an average of almost four percent in Western and Eastern Europe, and almost five percent in the south. Although the west was the most technologically advanced of the three, this period did see a significant amount of catching up in the other two regions, whose rapid industrialization and urbanization changed the lives of its citizens forever. Recession hits the west The recession of 1973-1975 brought this economic and industrial growth to an end, however, as conflict in the Middle East saw oil prices skyrocket. Virtually all of Western Europe's industrial powers went into recession, and this had a detrimental knock-on effect in Poland and Romania due to their indebtedness to the west. While the recession ended in most countries by 1976, factors such as unemployment, inflation, and industrial output often remained high until the 1980s. The 1980s and 1990s also saw the rapid economic growth of countries such as Ireland and Finland. However, growth was much slower in these decades for most western economies than it had been in the 1950s and1960s. Collapse of communism The 1970s marked the beginning of the economic decline in Eastern Europe, as the command economies of the East Bloc could not maintain pace with the capitalist west and failed to adapt to the challenges that emerged in this period. Communism in Eastern Europe eventually ended around the early 1990s, and the largest power, the Soviet Union, was dissolved. This resulted in severe economic hardships in the former communist states, and recovery in the former-Soviet states did not begin until the late 1990s. The effects of communism's collapse in Europe was so severe that GDP in the east actually fell by an average of 0.9 percent per year between 1973 and 1998

The economic failures of the communist began to show throughout the 1970s, as the oil crises of 1973 to 1980 exposed the Eastern Bloc's many financial instabilities. The 1973-1975 Recession in the West had a knock-on effect on the Eastern Bloc, particularly on Poland and Romania, as Western debtors began demanding repayment, imports into the Eastern Bloc became more expensive, and exports were no longer in high demand. Growth rates also began to fall further at the end of the decade, as the post-war economic boom ended. At the beginning of the 1970s, Eastern Europe's debt totaled six billion U.S. dollars; by the end of the decade, it was almost 80 billion. Although austerity in the 1980s did bring some measure of control to the Eastern economies, it only limited the growth rate of indebtedness across the region, which eventually rose to 110 billion dollars (over a third of which belonged to Poland alone) when European communism fell, around 1990.

In 1950, at the end of the recovery period that followed the Second World War, GDP per capita across the Eastern Bloc varied greatly by country. Czechoslovakia, the most industrialized country in the Bloc after East Germany, had a GDP per capita that was 69 percent of the rate across Western European** countries. In contrast, Romania's GDP per capita was less than a quarter of the Western European average in 1950. 1950-1989 Generally speaking, Eastern European economies grew faster and made gains on those of the west (not including Mediterranean region) in the 1950s and 1960s, however, a series of recessions and increasing debts meant that this gap widened in the 1970s and 1980s. By 1989, as communism in Europe came to an end, the difference between overall GDP per capita in the Eastern and Western Blocs returned to a similar rate as in 1950, although it varied by country. The Soviet Union, Czechoslovakia, and Poland, three of the larger economies of those given, had a lower share of western GDP per capita in 1989 than in 1950, while the smaller economies of the Balkans saw an increase. 1989-2000 Between 1989 and 2000, the European Union's GDP per capita grew faster than in the former Eastern Bloc countries. However, the end of communism did negatively impact EU economies in the early 1990s. Poland was the only Eastern Bloc country to make gains on the west in these years, although this was more to do with its poor economy in the 1980s. The former-Soviet states, in particular, saw GDP per capita drop below one-quarter of the European Union's rate over this decade, as post-Soviet economic recovery did not realistically begin until the late 1990s.

With a Gross Domestic Product of over 4.18 trillion Euros, the German economy was by far the largest in Europe in 2023. The similar-sized economies of the United Kingdom and France were the second and third largest economies in Europe during this year, followed by Italy and Spain. The smallest economy in this statistic is that of the small Balkan nation of Montenegro, which had a GDP of 5.7 billion Euros. In this year, the combined GDP of the 27 member states that compose the European Union amounted to approximately 17.1 trillion Euros. The big five Germany’s economy has consistently had the largest economy in Europe since 1980, even before the reunification of West and East Germany. The United Kingdom, by contrast, has had mixed fortunes during the same time period and had a smaller economy than Italy in the late 1980s. The UK also suffered more than the other major economies during the recession of the late 2000s, meaning the French economy was the second largest on the continent for some time afterward. The Spanish economy was continually the fifth-largest in Europe in this 38-year period, and from 2004 onwards, has been worth more than one trillion Euros. The smallest GDP, the highest economic growth in Europe Despite having the smallerst GDP of Europe, Montenegro emerged as the fastest growing economy in the continent, achieving an impressive annual growth rate of 4.5 percent, surpassing Turkey's growth rate of 4 percent. Overall,this Balkan nation has shown a remarkable economic recovery since the 2010 financial crisis, with its GDP projected to grow by 28.71 percent between 2024 and 2029. Contributing to this positive trend are successful tourism seasons in recent years, along with increased private consumption and rising imports. Europe's economic stagnation Malta, Albania, Iceland, and Croatia were among the countries reporting some of the highest growth rates this year. However, Europe's overall performance reflected a general slowdown in growth compared to the trend seen in 2021, during the post-pandemic recovery. Estonia experienced the sharpest negative growth in 2023, with its economy shrinking by 2.3% compared to 2022, primarily due to the negative impact of sanctions placed on its large neighbor, Russia. Other nations, including Sweden, Germany, and Finland, also recorded slight negative growth.

In the decade that followed the dissolution of the Soviet Union and the collapse of communist systems in Eastern Europe, economic conditions across the region generally got worse before they improved. GDP per capita had been declining throughout most of the 1980s but fell dramatically as communism ended. In Central and Eastern Europe, economic recovery began in the early 1990s, whereas this process did not start until 1996 in the former-Soviet states. As a result, GDP per capita in Central and Eastern Europe had almost returned to its 1989 level within a decade, whereas GDP per capita in the former-Soviet states had dropped by 45 percent between 1989 and 1998. This transitionary period in the continent's east did have a knock-on effect on the continent's West. However, growth did continue. Additionally, GDP per capita was 2.2 times larger in the West than in the Soviet Union in 1989, but by 1998 it was 4.6 times larger.

Since the beginning of the 20th century, the total number of independent nation states in Europe has almost doubled, from 24 countries in 1900 to 45 today. At the beginning of this period, much of Central and Eastern Europe was split between the empires of Austria-Hungary, Germany, the Ottomans, and Russia. The dissolution of these empires in the aftermath of the First World War resulted in the restoration or creation of several independent states, such as Czechoslovakia, Poland, and Yugoslavia. During the interwar period, there were generally 33 countries in Europe, before the Second World War saw Germany and the Soviet Union annex most of the territories between them, and control of these regions swapped between the two during the remainder of the war. Germany also invaded several Western European countries, and there were fewer than 20 independent countries in Europe at the peak of the war. Post-war Europe The post-war period then saw some major restructuring of Europe's borders, and most of the defeated Axis governments fell under Allied influence. However, there was then a split between the leading Allied Powers, and the continent was divided between the east and west. The communist, eastern countries, known as the Eastern Bloc, mostly fell under the influence of the Soviet Union; whereas the West remained largely democratic and was under American influence (but to a lesser extent). Both sides of Europe prospered throughout the post-war period, but the Eastern Bloc economies eventually collapsed or stagnated, and independence movements gained more momentum. Communist regimes across Europe began collapsing in 1989, before the Soviet Union's dissolution in late 1991. Soviet dissolution resulted in the formation of 15 separate countries, seven of which were in Europe, while Yugoslavia's eventually resulted in seven new states. Post-communist separation While the borders of Western Europe remained fairly stable throughout the entire period, Eastern Europe's changed greatly. A large part of this can be attributed to cultural and historical differences between different ethnic groups in the region, who were often forced to share their lands under various empires or world powers; the fall of communism provided an opportunity for these groups to separate, but it was not always a peaceful process. This was most notable in the Yugoslav Wars in the 1990s, where some states achieved independence through violence, while others descended into it thereafter. Communism's collapse also resulted in the expansion of European integration, and many eastern countries joined the European Union in the early-2000s; this resulted in a mass exodus of economic migrants from the former-Eastern Bloc, which has had a significant demographic and economic impact on both sides of the continent. Generally, political relations across the east have improved greatly in recent years, and prosperity is growing. However, there has been a noticeable rise in authoritarian leadership across Eastern Europe, and Russian interference in foreign politics is growing; it remains to be seen what impact this will have on the stability of the region.

Bulgaria, with the help of the Russian Empire, achieved independence from the Ottoman Empire in 1878. In the decades before independence, Bulgaria's population had remained between 2.2 and 2.8 million people, and growth was much slower then the following century. Although most at the time assumed that it would become a Russian ally, Bulgaria defied the expectations and aligned itself with the western powers, and developed into a modern European state by the turn in the late 1800s. Bulgaria at war In the early twentieth century Bulgaria was involved in both World Wars, as well as two Balkan Wars. The Balkan states were unhappy with the borders assigned to them by the western powers, and instead wanted to re-draw them based on the dispersal of ethnic groups. This led to the first Balkan War in 1912, which saw Bulgaria fight alongside Greece and Serbia against the Ottomans. Bulgaria fought the second Balkan War on all sides, this time against Greece, Serbia, Romania and the Ottomans, as the dispute over borders continued. Bulgaria was defeated this time, and sustained heavy casualties, amassing in 58 thousand fatalities and over 100 thousand wounded in the two wars.

In the First World War, Bulgaria remained neutral at first, in order to recover from the previous wars, but then aligned itself with the Central powers in 1915, and played a vital role in maintaining their control in the Balkans. While Bulgaria was initially successful, its allies weakened as the war progressed, and then Bulgaria eventually succumbed to Allied forces and surrendered in 1918, with almost 200 thousand Bulgarians dying as a result of the war. The interwar years was a period of political and economic turmoil, and when control was re-established, Bulgaria was then able to maintain it's neutrality throughout most of the Second World War, (although there was some conflict and bombings in certain areas). Rise and fall of communism After the war, Bulgaria became a communist state, and life became harsh for the civil population there until the late 1950s when the standard of living rose again. In the late 1980s, like many Eastern European countries, Bulgaria experienced economic decline as the communist system began to collapse. Political failures also contributed to this, and approximately 300 thousand Bulgarian Turks migrated to Turkey, greatly weakening the agricultural economy. This trend of mass migration abroad continued after the fall of the iron curtain, as well as the rise of unemployment. Bulgaria reached it's peak population size in 1985 at 8.98 million inhabitants, but then the number decreases each year, and is expected to be 6.94 million in 2020. This drop in population size has been attributed to the economic collapse at the end of communism in Eastern Europe, causing many to leave the country in search of work elsewhere. Bulgaria also has one of the lowest fertility rates in the world, with 8.7 births per 1,000 people per year (in 2018).

In terms of net material product* (the Soviet version of GDP), industrial growth rates in the Eastern Bloc in the early 1970s were fairly consistent, before a series of conflicts in the Middle East saw oil prices soar and sporadic recessions spread across Europe in the subsequent decade. Poland and Romania experienced the highest growth rates in the early years due to their reliance on Western investment; however, this would prove detrimental in the years to come. Other nations such as East Germany and Bulgaria saw more modest and consistent growth throughout these two decades, although all countries experienced recession with the collapse of European communism in the late 1980s Poland The reason for Poland's dramatic decline between 1978 and 1981 was due to the foreign debt accumulated by Poland under the Gierek regime (1970-1980), as the government attempted to modernize Poland's industry and establish trade links outside of the COMECON. As the West prospered, so too did Poland. However, the Recession of 1973-1975 hit the West much harder than the Eastern Bloc. This recession had a knock-on effect on Poland, causing the price of western imports to increase, the demand for Polish exports to drop, and creditors began to demand repayment, which led to further borrowing.

Economic hardship then exposed the instability and ineffectiveness of Poland's industrial sector, and the relatively progressive policies of the Gierek administration allowed trade unions to emerge in ways that were not possible in other Eastern Bloc countries. Solidarity emerged as the most powerful of these trade unions in 1980, with ten million members (of a total population of 35 million) at its peak; the government's implementation of martial law in an attempt to subdue Solidarity's influence then led to further sanctions from the West. As restrictions eased and economic aid arrived from the Soviet Union, Poland's net material product then grew from 1983 onwards. However, it fluctuated on a downward trend until communism's end in June 1989.

Although it was not a united country until 1871, industrialization across Germany began in the early 1800s, and it quickly saw Germany emerge as a Great Power in Europe. German industrialization was largely driven by coal and steel production, of which Germany had rich deposits, and these were used in construction and infrastructure to modernize the country. The mechanization of agriculture also fed into this, as many people from rural regions flocked to cities in search of work. Many of the coal and iron deposits were located in Germany's west, particularly around the Rhine and Ruhr regions, and industry here benefitted from strong rail and water transport networks. Today, with over five million inhabitants, the Ruhr region is the most populous metropolitan area in the country, largely due to these developments. While Germany was among the most advanced nations in the world by the end of the 19th century, industrial output grew higher still in the 20th; between 1896 and 1913, industrial output in Germany doubled. Interwar turmoil After the First World War, Germany lost its resource rich territories of Alsace-Lorraine and the Saarland, while the Rhine and Ruhr regions were also occupied by France, and much of its industrial output was sent to other countries as war reparations. Hyperinflation in 1923 also saw the collapse of the German economy, and it was not until the late-1920s that economic recovery from the war truly began, although this was also short-lived. As Germany had been dependent on financial aid from the U.S. in order to recover and meet its reparation payments, the Great Depression in the U.S. had dire consequences for the German economy. From 1929 until 1932, industrial output fell once more, and many historians point to this economic difficulty as a catalyst for the rise of nationalism and fascism in Germany. The Nazi Party then ascended to power in 1933, the year the Depression ended, and the economy was restructured to support a war of expansion. Among other factors, this involved tax breaks for large businesses, allowing cartels to control local business, increasing average working hours, and prioritizing industrial employment by importing food from the east. The strength of Germany's industry then allowed the Axis powers to take control of most of Europe during the Second World War, but it was ultimately defeated by 1945. Post-war split Following the war, Germany was split into two separate states; commonly referred to as East and West Germany. The west was a liberal democracy with a free-market economy, while the east was a communist state with a command economy, yet both became leaders in their respective trading blocks during the Cold War. When looking at industrial growth over the next three decades, using output in 1963 as a benchmark, East Germany's output grew over nine times larger from 1949 to 1975, whereas West Germany's grew by a factor of six. It is important to remember, however, that the west was larger, more populous, and starting from a more industrially developed point than the east, therefore it was consistently more advanced. The West also had fewer restrictions placed on it from other nations after the war, and it played a leading role in European integration; whereas the East was influenced more heavily by the USSR and it had less trade with other advanced nations, which hindered its technological development. West Germany's output took a hit in the 1970s due to the 1973-1975 Recession, whereas the East's economy was protected as it had little trade with the U.S. and its partners. However, the West quickly recovered and economic stagnation in the East throughout the 1980s would contribute to the eventual collapse of the Eastern Bloc, and Germany was officially reunified in 1990.

Bulgaria gained its independence from the Ottoman Empire in 1878, and for the next century the population grew at a relatively constant rate, before falling into decline from the 1980s until today. The ratio of men to women in Bulgaria has remained fairly level before the 1980s, with the difference never exceeding 100,000. It was only in the 1980s when the numbers began to drift further apart, with the male population decreasing at a higher rate than females. A difference of more than 100,000 people appeared in 1988, and 200,000 at the turn of the millennium. The difference in Bulgaria's male and female populations has remained around 200,000 people for the past two decades, as the overall population has fallen from around eight million to below seven million people. This drop in population size has been attributed to the economic collapse which followed the end of communism in Eastern Europe, causing many to leave the country in search of work elsewhere. Bulgaria also has one of the lowest birth rates in the world, with just 9 births per 1,000 people in 2020.