Final answer:
The Civil War's economic impact included severe inflation and wage disparities, particularly in the Confederate South due to its poor monetary policies. In the North, inflation was lower and mitigated by legal tender laws despite a drop in real wages. Post-war policies influenced by these hardships bolstered the nation's industrial and economic expansion.
Step-by-step explanation:
The economic impact of the Civil War was profound and far-reaching, particularly due to rampant inflation and the disruption of productive capacities. In the Confederacy, inflation was exacerbated by the government's monetary policies and the constant issuance of treasury notes, resulting in a devaluation of currency.
By the end of the war, $100 in Confederate currency was needed for what $1 could buy in 1861. While wages did rise, they did not keep up with the soaring prices, leading to severe economic hardship for Southern civilians. In contrast, the North's economic woes, though significant, were tempered by the use of legal tender notes—greenbacks—and the boost to the industrial economy provided by wartime production. Northern real wages did fall by about 20 percent despite an overall lower inflation rate of 80 percent. These economic challenges helped shape the post-war period, influencing policies and contributing to the nation's industrialization and subsequent economic growth.