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The Anglo-German productivity puzzle, 1895-1935: a restatement and a possible resolution

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  • Ritschl, Albrecht

Abstract

Recent research on international productivity comparisons has focused on the discrepancies between benchmark comparisons and time series extrapolations from other benchmarks. For a 1907 benchmark, Stephen Broadberry and Carsten Burhop (2007) find German manufacturing to be only slightly ahead of Britain. Their backward extrapolation from a broader 1935 benchmark is consistent with their 1907 benchmark, provided that a traditional but disputed industrial production series of Walther Hoffmann (1965) is used. If they instead employ a revised series by Ritschl (2004), they obtain an implausibly high productivity lead of 50 percent, evidence that they therefore discard. The present paper revisits this Anglo-German productivity puzzle and suggests a resolution. Drawing on Rainer Fremdling and Reiner Staeglin (2003), I present further revisions to Germany’s industrial production series. I also calculate a revised 1907 productivity benchmark. Both the revised extrapolation and the revised benchmark indicate that on the eve of World War I, German manufacturing productivity was clearly ahead of Britain.

Suggested Citation

  • Ritschl, Albrecht, 2008. "The Anglo-German productivity puzzle, 1895-1935: a restatement and a possible resolution," Economic History Working Papers 22309, London School of Economics and Political Science, Department of Economic History.
    • Handle: RePEc:ehl:wpaper:22309
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    References listed on IDEAS

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    1. Broadberry, Stephen & Burhop, Carsten, 2007. "Comparative Productivity in British and German Manufacturing Before World War II: Reconciling Direct Benchmark Estimates and Time Series Projections," The Journal of Economic History, Cambridge University Press, vol. 67(2), pages 315-349, June.
    2. Ritschl, Albrecht, 2004. "Spurious growth in German output data, 1913—1938," European Review of Economic History, Cambridge University Press, vol. 8(2), pages 201-223, August.
    3. R. J. Overy, 1975. "Cars, Roads, and Economic Recovery in Germany, 1932–8," Economic History Review, Economic History Society, vol. 28(3), pages 466-483, August.
    4. Broadberry, Stephen N., 1993. "Manufacturing and the Convergence Hypothesis: What the Long-Run Data Show," The Journal of Economic History, Cambridge University Press, vol. 53(4), pages 772-795, December.
    5. Fremdling, Rainer & De Jong, Herman & Timmer, Marcel P., 2007. "British and German Manufacturing Productivity Compared: A New Benchmark for 1935/36 Based on Double Deflated Value Added," The Journal of Economic History, Cambridge University Press, vol. 67(2), pages 350-378, June.
    6. Ward, Marianne & Devereux, John, 2003. "Measuring British Decline: Direct Versus Long-Span Income Measures," The Journal of Economic History, Cambridge University Press, vol. 63(3), pages 826-851, September.
    7. Fremdling Rainer, 2007. "German Industrial Employment 1925,1933,1936 and 1939. A New Benchmark for 1936 and a Note on Hoffmann's Tales," Jahrbuch für Wirtschaftsgeschichte / Economic History Yearbook, De Gruyter, vol. 48(2), pages 171-196, December.
    8. Broadberry S. N. & Ritschl A., 1995. "Real Wages, Productivity, and Unemployment in Britain and Germany during the 1920's," Explorations in Economic History, Elsevier, vol. 32(3), pages 327-349, July.
    9. Broadberry, S N & Fremdling, Rainer, 1990. "Comparative Productivity in British and German Industry 1907-37," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(4), pages 403-421, Special I.
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    Cited by:

    1. Broadberry, Stephen & Burhop, Carsten, 2008. "Resolving the Anglo-German Industrial Productivity Puzzle, 1895–1935: A Response to Professor Ritschl," The Journal of Economic History, Cambridge University Press, vol. 68(3), pages 930-934, September.
    2. Cristiano Andrea Ristuccia & Adam Tooze, 2013. "Machine tools and mass production in the armaments boom: Germany and the United States, 1929–44," Economic History Review, Economic History Society, vol. 66(4), pages 953-974, November.
    3. Fremdling, Rainer, 2018. "Statistik und Organisation der NS-Kriegswirtschaft und der DDR-Planwirtschaft 1933-1949/50 [Statistics and Organization of the NS-War Economy and the East-German Planned Economy 1933-1949/50]," MPRA Paper 87664, University Library of Munich, Germany.
    4. Joost Veenstra & Herman Jong, 2016. "A Tale of Two Tails: Establishment Size and Labour Productivity in United States and German Manufacturing at the Start of the Twentieth Century," Australian Economic History Review, Economic History Society of Australia and New Zealand, vol. 56(2), pages 198-220, July.
    5. Nikita I. Lychakov & Dmitrii L. Saprykin & Nadia Vanteeva, 2020. "Not Backward: Comparative Labour Productivity In British And Russian Manufacturing, Circa 1908," HSE Working papers WP BRP 199/HUM/2020, National Research University Higher School of Economics.

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    More about this item

    JEL classification:

    • N0 - Economic History - - General
    • B1 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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