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Making profits in wartime: corporate profits, inequality, and GDP in Germany during the First World War

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  • JOERG BATEN
  • RAINER SCHULZ

Abstract

Making profits in wartime: corporate profits, inequality, and GDP in Germany during the First World War. This article reconsiders, and rejects, Kocka's (1973) hypothesis that a strong income redistribution from workers to capital owners occurred in Germany during the First World War. A small number of firms profited from the war, but the majority experienced a decline in real income, similar to the decline in workers' real wages. This finding also has important implications for the political history of the Weimar Republic. The authors also use their figures to improve German GDP estimates for the war period, since their sample makes it possible to estimate private service sector development. Economic indicators were worse for the war year of 1917 than previously believed.

Suggested Citation

  • Joerg Baten & Rainer Schulz, 2005. "Making profits in wartime: corporate profits, inequality, and GDP in Germany during the First World War," Economic History Review, Economic History Society, vol. 58(1), pages 34-56, February.
    • Handle: RePEc:bla:ehsrev:v:58:y:2005:i:1:p:34-56
    DOI: 10.1111/j.1468-0289.2005.00297.x
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    References listed on IDEAS

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    1. A. J. Arnold, 1999. "Profitability and capital accumulation in British industry during the transwar period, 1913–1924," Economic History Review, Economic History Society, vol. 52(1), pages 45-68, February.
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    Cited by:

    1. Blum, Matthias & Strebel, Matthias, 2016. "Max Weber and the First World War: Protestant and Catholic living standards in Germany, 1915–1919," Journal of Institutional Economics, Cambridge University Press, vol. 12(3), pages 699-719, September.
    2. Filip Novokmet, 2018. "The long-run evolution of inequality in the Czech Lands, 1898-2015," PSE Working Papers hal-02878212, HAL.
    3. Petra Moser & Alessandra Voena, 2012. "Compulsory Licensing: Evidence from the Trading with the Enemy Act," American Economic Review, American Economic Association, vol. 102(1), pages 396-427, February.
    4. Filip Novokmet, 2018. "The long-run evolution of inequality in the Czech Lands, 1898-2015," World Inequality Lab Working Papers hal-02878212, HAL.
    5. Thilo N. H. Albers & Charlotte Bartels & Moritz Schularick, 2020. "The Distribution of Wealth in Germany, 1895-2018," ECONtribute Policy Brief Series 001, University of Bonn and University of Cologne, Germany.
    6. Harrison, Mark, 2011. "Capitalism at War," CAGE Online Working Paper Series 60, Competitive Advantage in the Global Economy (CAGE).
    7. Blum, Matthias, 2011. "Government decisions before and during the First World War and the living standards in Germany during a drastic natural experiment," Explorations in Economic History, Elsevier, vol. 48(4), pages 556-567.
    8. Filip Novokmet, 2018. "The long-run evolution of inequality in the Czech Lands, 1898-2015," Working Papers hal-02878212, HAL.

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