The post-war era had a significant effect on consumer borrowing habits, characterized by a sharp growth in consumer credit use driven by rising incomes, mass production, and increased consumer optimism. Key Effects on Consumer Borrowing Habits:

• Expansion of Consumer Credit: After World War II, consumer credit outstanding grew dramatically in nominal terms, from about $6.8 billion in 1945 to over $3 trillion by 2013. This growth reflected increased consumer borrowing to finance durable goods and household items as Americans sought to improve their standard of living

• Increased Consumer Spending and Borrowing: The post-war economic boom led to higher incomes and mass production of goods, making products more affordable and fueling demand. Americans bought millions of new homes, cars, appliances, and furniture, often financed through credit. Spending on home-related goods increased by 240% in the first four years after the war

• Consumer Borrowing as a Normal Economic Behavior: The use of consumer credit became widely accepted as a normal part of modern economic life. Credit was seen as a tool to support consumption and economic growth rather than a source of financial distress for most users. Studies show that consumer credit growth correlated positively with future consumption, reflecting consumer optimism about economic prospects

• Government Restrictions During the War and Relaxation Post-War: During World War II, consumer borrowing was heavily restricted to curb inflation and direct resources to the war effort, with limits on installment buying and credit terms. After the war, these restrictions were relaxed, enabling a resurgence in credit use and consumer borrowing

• Broadening Access to Credit: Growth in consumer credit use occurred across all income groups and ages, though the highest income groups held the largest shares of outstanding debt. The post-war era saw credit becoming more accessible, supporting the rise of the American Dream where consumers borrowed with confidence in their future incomes

In summary, the post-war era catalyzed a significant increase in consumer borrowing, supported by rising incomes, relaxed credit restrictions, and a cultural shift toward viewing credit as a normal and positive economic tool. This period laid the foundation for modern consumer credit markets and mass consumption patterns in the United States