Final answer:
American expatriates in Paris were supported financially by the prosperity of the U.S. economy in the early 20th century, which was marked by technological advances, consumer spending, and heavy investments in European markets.
Step-by-step explanation:
The ability of American expatriates to remain in Paris despite restrictions on foreign labor is tied to the economics of the American economy during the period, particularly in the early 20th century. After World War I, the United States emerged as an economic powerhouse, remaining largely unscathed physically by the conflict and positioned as a creditor nation. The 1920s, known as the Roaring Twenties, were characterized by prosperity and economic growth, with technological innovations fueling consumerism and the rise in demand for goods. With American corporations investing heavily in European markets, there was a large influx of American dollars internationally, despite concerns around trade deficits. The accumulation of wealth by the American financial elite, especially those involved in business within urban centers, allowed for a lifestyle of comfort and luxury.
The economics of the time, characterized by high consumer spending, investments, and a strong American dollar, provided the financial support expatriates needed to fund their life abroad. While foreign investment capital was not a significant portion of U.S. investment funds, it was still a net positive for the economy. This economic vitality ultimately trickled down and allowed expatriates to depend on American money in order to finance their stays in Paris, where they could not work legally.