In the western world, social progressive values that began in the 1960s, such as increasing political awareness and political and economic liberty of women, continued to grow. The hippie culture, which started in the 1960s, continued in the early 1970s and faded towards the middle part of the decade, which involved opposition to the Vietnam War, opposition to nuclear weapons, the advocacy of world peace, and hostility to the authority of government. The environmentalist movement began to increase dramatically in this period. Western countries experienced an economic recession due to oil crisis caused by oil embargoes by Arab countries in the Middle East, while Japan's economy boomed. The crisis saw the first instance of stagflation which began a political and economic trend of the replacement of Keynesian economic theory with neoliberal economic theory, with the first neoliberal government being created in the United Kingdom with election of the Conservative Party under Margaret Thatcher in 1979.

In Asia, affairs regarding the People's Republic of China changed significantly following the recognition of the PRC by the United Nations, the death of Mao Zedong and the beginning of market liberalization by Mao's successors. The economy of Japan witnessed a large boom in this period. The United States withdrew its military forces from their previous involvement in Vietnam which had grown enormously unpopular. In 1979, the Soviet Union invaded Afghanistan which led to an ongoing war for ten years. The 1970s saw an initial increase in violence in the Middle East as Egypt and Syria declared war on Israel, but in the late 1970s, the situation in the Middle East was fundamentally altered when Egypt signed a peace agreement with Israel which was followed by Egyptian President Anwar Sadat being assassinated. Political tensions in Iran exploded with the Iranian Revolution which overthrew the Iranian monarchy and established an Islamic theocracy in Iran.

The economies of many third world countries continued to make steady progress in the early 1970s, because of the green revolution. They might have thrived and become stable in the way that Europe recovered after the war through the Marshall Plan; however, their economic growth was slowed by the oil crisis.

Worldwide trends

The first ethos of the 1970s emerged from a transition of the global social structure. It reflected the transition from the decline of colonial imperialism since the end of World War II to globalization and the rise of a new middle class in the developing world.

Globally, the 1970s had several features that were similar and definitive across economic levels and regions. Some defining points of the 1970s were the Arab-Israeli war of 1973 and the subsequent oil shock of 1973, the economic strain caused by the rapid increase in the price of oil and its influence on the Bretton Woods system of international economic stabilisation, and the effect of the contraceptive pill on social dynamics.