Superior productivity of American industrial workers

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historygeek2021
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Re: Superior productivity of American industrial workers

Post by historygeek2021 » 21 Jul 2021 23:03

It appears that pre-war and wartime exchange rates did not factor into the figures presented by Goldsmith and Broadberry. Broadberry's underlying source relied on a measure of physical output:
WW2 Labor Productivity Rostas Method.png
https://books.google.com/books?id=GG43A ... &q&f=false

Likewise, from Harrison's website, Goldsmith did not use exchange rates to calculate his armaments expenditures index:
WW2 Labor Productivity Goldsmith Method.png
https://warwick.ac.uk/fac/soc/economics ... ndices.pdf

Broadberry's post-war figures do rely on exchange rates, but by then the international monetary system had stabilized, so the exchange rates should be a reliable source for computing relative productivity.
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TheMarcksPlan
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Re: Superior productivity of American industrial workers

Post by TheMarcksPlan » 22 Jul 2021 14:10

historygeek2021 wrote:
21 Jul 2021 23:03
It appears that pre-war and wartime exchange rates did not factor into the figures presented by Goldsmith and Broadberry. Broadberry's underlying source relied on a measure of physical output:
Thanks!
historygeek2021 wrote: Broadberry's post-war figures do rely on exchange rates, but by then the international monetary system had stabilized, so the exchange rates should be a reliable source for computing relative productivity.
Does Broadberry use a nominal market exchange rate or a PPP rate postwar?
historygeek2021 wrote:Likewise, from Harrison's website, Goldsmith did not use exchange rates to calculate his armaments expenditures index:
Harrison's being generous to the actual content of the article. As I pointed out upthread, Goldsmith's 12-page article doesn't show any work; the US-Germany output-comparing analysis is a couple paragraphs with no calculations. That's why I suspect Goldsmith just worked backwards from nominal expenditures and prewar market exchange rates.

I'm trying to create a "physical" index of armaments production on a spreadsheet. When it's decent, I'll share it as editable and non-editable Google doc. Here's a screenshot so far, with estimated index values standing in for physical quantities. I'm working off July '44 instead of Goldsmith's 1944:

Image

"Guesses" are highlighted in yellow. Aircraft weights from KDF33, German armor from USSBS and as calculated for US, ammo discussed below. As you can see, my first take is that Goldsmith underestimated the American output advantage. For 1944 as a whole, his underestimate would be even greater. Again, my sense is that he worked backwards from prewar market exchange rates, which failed to notice higher inflation in wartime Germany than in US.

I'd like to propose we work together to complete this analysis. As it's not a productivity analysis, per se, (though related) I'm happy to split it into a new thread. There's a lot of data-gathering necessary to estimate MV and naval production; necessary to that are several analytical choices we can discuss.

For example: how to weight Germany's relative emphasis on half-tracks in the MV section? First thought is to obtain relative German prices for trucks and half-tracks and create a "truck-equivalents" ratio. Note that my first-take has already applied a penalty to US aircraft frame-weight output for its emphasis on heavy bombers.

My guess for US:Germany weapons ratio is probably too high. Just a rough draft.

--------------------------------------

It's a shame that even Mark Harrison has no better "physical" index than one produced in 1946, that shows no work, and that "conveniently" tracks USD:RM prewar market exchange values. Maybe we can fix that.

-----------------------------
KDF33 wrote:
06 Jul 2021 04:13
TheMarcksPlan wrote:
06 Jul 2021 01:13
I don't have US ammo production figures at hand (anybody have them)
I do. In metric tons, Germany / U.S. (with naval):

1941: 540,000 / 58,434 (no data) = 9.2-to-1
1942: 1,270,000 / 707,511 (798,763) = 1.8-to-1 (1.6-to-1)
1943: 2,558,000 / 879,362 (1,130,557) = 2.9-to-1 (2.3-to-1)
1944: 3,350,000 / 1,543,401 (2,013,237) = 2.2-to-1 (1.7-to-1)

Note that German data doesn't include naval ammunition.

Source for Germany: Armaments report, BA-MA R 3/1729
Source for the U.S.: Official Munitions Production of the United States (1947)
I've added US bombs to the table for ammo using your source. Is the German source available online or can you email me it? Idk its scope.
https://medium.com/counterfactualww2
"The whole question of whether we win or lose the war depends on the Russians." - FDR, June 1942

historygeek2021
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Re: Superior productivity of American industrial workers

Post by historygeek2021 » 22 Jul 2021 18:34

TheMarcksPlan wrote:
22 Jul 2021 14:10

Does Broadberry use a nominal market exchange rate or a PPP rate postwar?
From his article:
WW2 Labor Productivity Broadberry Method.png
Harrison's being generous to the actual content of the article. As I pointed out upthread, Goldsmith's 12-page article doesn't show any work; the US-Germany output-comparing analysis is a couple paragraphs with no calculations. That's why I suspect Goldsmith just worked backwards from nominal expenditures and prewar market exchange rates.
Wow, that is pretty bad. It's a shame that no work has been done in this field since this lightweight attempt in 1946.
I'm trying to create a "physical" index of armaments production on a spreadsheet. When it's decent, I'll share it as editable and non-editable Google doc. Here's a screenshot so far, with estimated index values standing in for physical quantities. I'm working off July '44 instead of Goldsmith's 1944:

Image
I don't understand what most of the columns in the chart mean. Can you explain (e.g., %value, item ratio, US:German adjustment)?

I also don't understand what "index" means under the "units" column, or "mt". Please provide a key.
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Re: Superior productivity of American industrial workers

Post by TheMarcksPlan » 22 Jul 2021 18:52

historygeek2021 wrote:I don't understand what most of the columns in the chart mean. Can you explain (e.g., %value, item ratio, US:German adjustment)?

I also don't understand what "index" means under the "units" column, or "mt". Please provide a key
mt = metric tonnes.

US:German adjustment is any adjustment of physical quantity for cost factors. The only place I applied is to US aircraft production due to heavy bombers being cheaper per ton.

Index is basically a placeholder for a guess. Where I haven't yet decided on, let alone produced, a physical quantity for comparison, index is a guess with Germany=1 and US equals whatever multiple of Germany is guessed.

Item ratio tells the US multiple of German production (same as US "index" value when "units" are "index").

%value is the percent of German total armaments expenditure on a given item.

Multiply each German RM value times American multiple (item ratio), then by "adjustment" column, gives American production in RM. Summing American production items gives you the total US output in RM. Divide by German armaments in RM for ratio of armaments output.

I only give physical values for 3 categories so far - aircraft, ammo, AFV - but that's >70% of the story using a German base-weighting.

As with any base-weighted series like the CPI, choice of base influences outcome. I used German base because Wagenfuehr gives exact figures and they're quoted by Eichholtz. US base would produce a different result- can't say which direction. A geometric mean of the two resulting indices would be ideal.
https://medium.com/counterfactualww2
"The whole question of whether we win or lose the war depends on the Russians." - FDR, June 1942

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