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The Sources of Growth in a Technologically Progressive Economy: the United States, 1899-1941

Author

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  • Bakker, Gerben

    (London School of Economics)

  • Crafts, Nicholas

    (University of Warwick)

  • Woltjer, Pieter

    (University of Groningen)

Abstract

We develop new aggregate and sectoral Total Factor Productivity (TFP) estimates for the United States between 1899 and 1941 through better coverage of sectors and better-measured labor quality, and find TFP-growth was lower than previously thought, broadly based across sectors, and strongly variant intertemporally. We then test and reject three prominent claims. First, the 1930s did not have the highest TFP-growth of the twentieth century. Second, TFP-growth was not predominantly caused by four ‘great inventions’. Third, TFP-growth was not driven indirectly by spillovers from great inventions such as electricity. Instead, the creative-destruction-friendly American innovation system was the main productivity driver.

Suggested Citation

  • Bakker, Gerben & Crafts, Nicholas & Woltjer, Pieter, 2017. "The Sources of Growth in a Technologically Progressive Economy: the United States, 1899-1941," CAGE Online Working Paper Series 341, Competitive Advantage in the Global Economy (CAGE).
    • Handle: RePEc:cge:wacage:341
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    References listed on IDEAS

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    Cited by:

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    3. Eoin McLaughlin & Cristián Ducoing & Les Oxley, 2024. "Tracing Sustainability in the Long Run: Genuine Savings Estimates 1850–2018," NBER Chapters, in: Measuring and Accounting for Environmental Public Goods: A National Accounts Perspective, National Bureau of Economic Research, Inc.
    4. Kyoji Fukao & Tatsuji Makino & Tokihiko Settsu, 2021. "Human Capital And Economic Growth In Japan: 1885–2015," Journal of Economic Surveys, Wiley Blackwell, vol. 35(3), pages 710-740, July.
    5. Michael D. Bordo & Arunima Sinha, 2023. "The 1932 Federal Reserve Open‐Market Purchases as a Precedent for Quantitative Easing," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 55(5), pages 1177-1212, August.
    6. Fioramonti, Lorenzo & Coscieme, Luca & Costanza, Robert & Kubiszewski, Ida & Trebeck, Katherine & Wallis, Stewart & Roberts, Debra & Mortensen, Lars F. & Pickett, Kate E. & Wilkinson, Richard & Ragnar, 2022. "Wellbeing economy: An effective paradigm to mainstream post-growth policies?," Ecological Economics, Elsevier, vol. 192(C).
    7. Alexander J. Field, 2023. "The decline of US manufacturing productivity between 1941 and 1948," Economic History Review, Economic History Society, vol. 76(4), pages 1163-1190, November.
    8. Andrew Beauchamp, 2020. "Humane Capital: A Reexamination of Catholic Social Teachings in Light of the Shift to Human Capital," American Journal of Economics and Sociology, Wiley Blackwell, vol. 79(4), pages 1209-1240, September.
    9. Gallardo Albarrán, Daniel, 2024. "The Global Sanitary Revolution in Historical Perspective," CEPR Discussion Papers 18754, C.E.P.R. Discussion Papers.
    10. Gerben Bakker, 2021. "Infrastructure killed the electric car," Nature Energy, Nature, vol. 6(10), pages 947-948, October.
    11. John G. Fernald & Robert Inklaar, 2022. "The UK Productivity “Puzzle” in an International Comparative Perspective," Working Paper Series 2022-07, Federal Reserve Bank of San Francisco.
    12. Tony Ward, 2024. "Ritalin, Animal Spirits and the Productivity Puzzle," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 57(2), pages 129-142, June.

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    Keywords

    productivity growth; total factor productivity; great inventions; spillovers; United States — history JEL Classification: N11; N12; O47; O51.;
    All these keywords.

    JEL classification:

    • N0 - Economic History - - General

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