Nominal GNP's for the world at the eve of WW2

Discussions on the economic history of the nations taking part in WW2, from the recovery after the depression until the economy at war.
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Re: Nominal GNP's for the world at the eve of WW2

Post by Guaporense » 13 Aug 2012 00:33

pugsville wrote:Yes but exchange rates in the 1930s were pretty unreliable. No one really accepted other peoples currency, a lot of European trade moved into a Barter economy. I would be reticent to use 1930s monetary exchange rates without some n decent analysis. GDP is a gross approximation it's not an exact measure of anything.
Both your assertions are true to a certain extent. However, it remains the fact that these figures represent the actual market value in international terms of the economies being analysed. GDP at market exchange rates is good for measuring also the purchasing power in terms of tradeable goods, those goods that can be imported and exported.

Also, you are incorrect in claiming that most exchange was "barter" in the 1930's. That would be true in the Early Middle Ages, not in the 1930's. In the 1930's the world economy was less integrated than today (trade as a fraction of GDP was smaller), but nevertheless the industrialized world was already integrated enough so that it had formed a single macroeconomic sphere that enabled international comparisons of national product using market exchange rates.
Last edited by Guaporense on 13 Aug 2012 00:41, edited 1 time in total.
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Re: Nominal GNP's for the world at the eve of WW2

Post by Guaporense » 13 Aug 2012 00:39

HenryW wrote:http://www.ggdc.net/maddison/content.shtml

scroll down to Historical statistics for files on historical GDPs

Henry
I don't like Maddison's figures very much. That's why I made these figures myself. I noticed that Maddison's figures are problematic and they are estimates of PPP GDP's, which are a different type of statistic than the one that I am interested in. Also, Maddison's figures cannot be used to estimate warmaking potential and his figures also lack a certain rigor. I have analysed some of his figures more closely and found severe problems. For instance, Maddison's figures tend to underestimate Germany while overestimating the size of the rest of Europe. Also, Maddison tries to fit everything in one measure, including China and India, though these economies were agricultural subsistence economies and thus didn't have an actual GDP. Nor they computed one.

So, don't even try to find GDP figures for the territories that Japan occupied, these territories lacked the statistical database required for the existence of GDP figures in the first place. The GDP figures I gave earlier for Korea, China and Taiwan shouldn't be taken much seriously, they are not the product of rigorous analysis, since the statistics required for the computation of GDP did not exist in China, Taiwan and Korea in the 1930's.
"In tactics, as in strategy, superiority in numbers is the most common element of victory." - Carl von Clausewitz

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Re: Nominal GNP's for the world at the eve of WW2

Post by Guaporense » 13 Aug 2012 03:20

Guaporense wrote:Military expenditures of the major powers, in billions of 1939 dollars:

Image

Methodology:

Military expenditures are converted using market exchange rates from 1933 to 1939, figures from 1940 to 1944 are converted to 1939 dollars using GNP/GDP deflators and converted to 1939 dollars using market exchange rates (or the MPI for the case of the Soviet Union).
Munitions production and military expenditures. German data is much higher than Goldsmith's estimate from 1946 of munitions production relative to the US, in billions of 1945 dollars:

--------- Germany ------ US
1941 ------- 6 ----------- 6
1942 ------- 8.5 -------- 20
1943 ------- 13.8 ------- 38
1944 ------- 17 --------- 42

Well, to understand the discrepancy between the two note that in 1943, Germany had 60% of it's war related employment in the armed forces, while in the case of the US the relation was the inverse: 40% was employed in the armed forces and 60% in the munitions industries. So applying these proportions to the military expenditures we get: Germany, 16.8 billion and US, 33.82 billion. Adjusting US military expenditures (using the proportions calculated by Harrison in http://www2.warwick.ac.uk/fac/soc/econo ... edded=true), we have US military expenditures of 63.55 billion in 1943, 60% of which is 38.15 billion. US munitions production was much larger than Germany's because the US focused a greater proportion of their resources on munitions, due to the fact that the US was fighting a war of continents and so had to develop a very large air force and navy.

Notice also that I think that German munitions production was closer to 50% of US's level than 40%, as estimated by Goldsmith, because Goldsmith failed to include ammunition in his analysis and German production of ammunition was greater (in 1944, Germany produced 12 million rounds of ammunition of over 120 mm, compared to US production of 9.7 million rounds):

US heavy field artillery ammo production (over 4.5 inches or over 114.3 mm), thousands:

1942 - 6,209
1943 - 5,537
1944 - 9,668

total, 42-44: 21,414

source: WPA, pg 108

German production of ammo over 122 mm:

1942 - 5,622
1943 - 10,730
1944 - 11,776

total, 42-44: 28,128 (31.3% more than US production)

source: http://www.sturmvogel.orbat.com/GermWeapProd.html

Germany produced much more ground related munitions than 36.3% of US production in 1943, as estimated by Goldsmith. Production of heavy artillery ammunition was twice American levels. And ammunition was 70-80% of total ground related munitions production. American material superiority wasn't as great as portrayed by the scholars.
"In tactics, as in strategy, superiority in numbers is the most common element of victory." - Carl von Clausewitz

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Re: Nominal GNP's for the world at the eve of WW2

Post by Guaporense » 13 Aug 2012 14:06

Is realistic to think that German military expenditures were 2/3 of American expenditures in 1943? Well, here are the nominal German military expenditures in billion RM:

1940: 53
1941: 71
1942: 91
1943: 112

And here are the nominal American expenditures, billions of current dollars:

1941: 13.8
1942: 49.4
1943: 79.7
1944: 87.4

Some munitions prices:

Germany

Navy:

Ship ------------ cost ------ displacement -------- cost per ton
Bismarck ------ 197 MRm - 41,700 metric tons - 4,724 rm
Tirpitz --------- 181 MRm - 42,900 metric tons - 4,220 rm
Scharnhorst --- 146 MRm - 32,600 metric tons - 4,480 rm
Gneisenau ----- 143 MRm - 32,600 metric tons - 4,386 rm
Hipper ---------- 86 MRm - 16,200 metric tons -- 5,308 rm
Blucher --------- 87 MRm - 16,200 metric tons --- 5,370 rm
Prince Elgen --- 105 MRm - 17,000 metric tons -- 6,176 rm
Type VII* -------- 2 MRm --- 769 metric tons ------ 2,601 rm

From http://forum.axishistory.com/viewtopic. ... 16#p631716)
and http://forum.axishistory.com/viewtopic. ... 77#p628277)

*april 1943 price

Air force:

------------- aircraft ----- cost ------------ weight ---- cost per ton
1942/43 -- Ju 88 A-4 --- 254,496 rm --- 8,550 kg -- 29,766 rm

Source: http://www.econ.yale.edu/growth_pdf/cdp905.pdf, average of the cost of the highest and lowest unit cost for the 1942/1943 fiscal year

Army:

Tank ------------ cost ------- weight-------- cost per ton
Tiger I ------- 299,800 rm -- 56.9 ---------- 5,269 rm
Panther D ---- 129,600 rm --- 43.0 -------- 3,014 rm
Panzer IV --- 115,962 rm --- 25.0 ---------- 4,638 rm
Panzer III --- 103,163 rm --- 23.0 ---------- 4,485 rm
StuG III ----- 82,500 rm ---- 23.9 ---------- 3,452 rm

Source: http://www.panzerworld.net/prices

Note: added the cost of the gun when the price wasn't included, to be comparable to American tank prices

United States

Navy:

Ship -------------- cost ------ displacement -------- cost per ton
North Carolina -- 60 MUS$ -- 37,200 tons -------- 1,613 US$
Iowa ------------- 100 MUS$ -- 45,000 tons ------- 2,222 US$
Submarine ------ 3 MUS$ ----- 1,550 tons -------- 1,935 US$

Air force:

------------- aircraft ----- cost ------------ weight ----- cost per ton
1943 ------- B-25 -------- 151,894 -------- 8,855 kg --- 17,153 US$
1943 ------- B-26 -------- 212,932 -------- 11,000 kg -- 19,357 US$

From: http://www.usaaf.net/digest/t82.htm

Army:

Tank ------------ cost ------- weight-------- cost per ton
M36 ------------- 51,290 ---- 29.0 ---------- 1,769 US$
M10A1 ---------- 43,677 ---- 29.6 ---------- 1,476 US$
M3A3 ----------- 54,533 ----- 14.7 ---------- 3,710 US$
M4A1(76) ------ 51,509 ----- 30.3 ---------- 1,700 US$

Computing the PPP's:

Battleships (RM/dollar): 2.32
Medium bombers (1943 prices): 1.63
Tanks: 1.93

Geometric average: 1.94

Dividing the German nominal expenditures by 1.94 we get:

1940: 27.32
1941: 36.60 (265% of US's)
1942: 46.91 (94.9% of the US's)
1943: 57.73 (72.4% of the US's)

Compare with my revised estimates of military expenditures:

Image

It has:

1941: German outlays 176% of the US's
1942: German outlays 75.6% of the US's
1943: German outlays 66.1% of the US's

However, note that I include the Lend-Lease expenditures of the US in these revised figures (which increase US expenditures by ca. 10 billion per year).
"In tactics, as in strategy, superiority in numbers is the most common element of victory." - Carl von Clausewitz

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Estimating Soviet military expenditures

Post by Guaporense » 13 Aug 2012 19:45

From the World Economic survey 1942-1944:

Image

We have the nominal military expenditures of the USSR, billion rubles:

1941 - 70.9
1942 - 108.4
1943 - 124.7
1944 - 128.4

Compare to the military expenditures estimated from the MPI estimated GNP of the USSR using Harrison's proportions of military expenditures in proportion to national product, in billions of 1939 dollars:

1942 - 13.18
1943 - 14.84
1944 - 16.01

Notice that these numbers are higher than those above, the difference can be understood in terms of Lend-Lease. In the table above the expenditures on Lend-Lease goods are in the US's table, here the billions of dollars of LL goods are in the Soviet table. Yes, LL was responsible for 20-25% of all military expenditures of the USSR in 1943 and 1944:

Soviet military expenditures, in billions of 1939 dollars, by source:

-------- Domestic ---- LL ------- total
1942 - 10.68 --------- 2.5 ----- 13.18
1943 - 11.93 --------- 2.91 ---- 14.84
1944 - 12.35 --------- 3.66 ---- 16.01

The USSR started receiving American and British help in July 1941. They made an important contribution in the eastern front and in total the Western Allies delivered 17 billion 1945 dollars to the USSR (that's about 11 billion 1939 dollars, using Friedman & Schwartz price index).

So, how reasonable is this conversion, of 108.4 billion rubles of 1942 to 13.18 billion dollars of 1939?

Well, in 1942, Soviet factories were producing T-34 at 209,700 - 165,810 rubles, that's 25,497 - 20,160 1939 dollars. Converting to 1945 dollars using Friedman price index (1 1939 dollar = 1.56 1945 dollar) we have 39,927 - 31,570 dollars. That's similar to the prices of Sherman tanks, a bit lower, thanks to the lower quality.

So we have these rates of conversion:

1942 Ruble to 1939 Dollar: 8.22
1943 Ruble ----------------: 8.40
1944 Ruble ----------------: 8.02
"In tactics, as in strategy, superiority in numbers is the most common element of victory." - Carl von Clausewitz

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Price Lists

Post by nebelwerferXXX » 14 Aug 2012 13:06

Guaporense wrote:German Navy:

Ship ------------ cost ------ displacement -------- cost per ton
Bismarck ------ 197-M Rm - 41,700 metric tons - 4,724 rm
Tirpitz --------- 181-M Rm - 42,900 metric tons - 4,220 rm
Scharnhorst --- 146-M Rm - 32,600 metric tons - 4,480 rm
Gneisenau ----- 143-M Rm - 32,600 metric tons - 4,386 rm
Hipper ---------- 86-M Rm - 16,200 metric tons -- 5,308 rm
Blucher --------- 87-M Rm - 16,200 metric tons --- 5,370 rm
Prince Eugen --- 105-M Rm - 17,000 metric tons -- 6,176 rm
Type VII* -------- 2-M Rm --- 769 metric tons ------ 2,601 rm

Luftwaffe:

------------- aircraft ----- cost ------------ weight ---- cost per ton
1942/43 -- Ju 88 A-4 --- 254,496 rm --- 8,550 kg -- 29,766 rm

German Army:

Tank ------------ cost ------- weight-------- cost per ton
Tiger I ------- 299,800 rm -- 56.9 ---------- 5,269 rm
Panther D ---- 129,600 rm --- 43.0 -------- 3,014 rm
Panzer IV --- 115,962 rm --- 25.0 ---------- 4,638 rm
Panzer III --- 103,163 rm --- 23.0 ---------- 4,485 rm
StuG III ----- 82,500 rm ---- 23.9 ---------- 3,452 rm

US Navy:

Ship -------------- cost ------ displacement -------- cost per ton
North Carolina -- 60-M US$ -- 37,200 tons -------- 1,613 US$
Iowa ------------- 100-M US$ -- 45,000 tons ------- 2,222 US$
Submarine ------ 3-M US$ ----- 1,550 tons -------- 1,935 US$

US Air Force:

------------- aircraft ----- cost ------------ weight ----- cost per ton
1943 ------- B-25 -------- 151,894 -------- 8,855 kg --- 17,153 US$
1943 ------- B-26 -------- 212,932 -------- 11,000 kg -- 19,357 US$

US Army:

Tank ------------ cost ------- weight-------- cost per ton
M36 ------------- 51,290 ---- 29.0 ---------- 1,769 US$
M10A1 ---------- 43,677 ---- 29.6 ---------- 1,476 US$
M3A3 ----------- 54,533 ----- 14.7 ---------- 3,710 US$
M4A1(76) ------ 51,509 ----- 30.3 ---------- 1,700 US$
Another Estimating Guide for beginners.

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Re: Nominal GNP's for the world at the eve of WW2

Post by nebelwerferXXX » 20 Aug 2012 13:38

Guaporense wrote: 2011 (source: International Monetary Fund):

Europe ------------------- 21.32 trillion
-- European Union ------ 17.68 trillion
-- Western Europe/EU -- 1.12 trillion
-- Eastern Europe/EU --- 0.16 trillion (former Yugoslavia)
-- Former USSR --------- 2.36 trillion

USA ----------------------- 15.09 trillion
Japan --------------------- 5.87 trillion

total ---------------------- 42.28 trillion

Europe's share ----------- 50.43%
Does China will overtake the USA by 2020 ?

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Re: Nominal GNP's for the world at the eve of WW2

Post by Guaporense » 03 Jan 2015 04:42

It already did effectively: China is the world largest agricultural and manufacturing producer, the world's largest trading nation as well. The US is bigger only in terms of services sector, since for instance, a haircut costs 10 times in the US than in China, so the US's services sector was almost 4 times larger in 2013, but that is thanks to high labor costs. In any physical indicator China is already the world's largest country.
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Re: Nominal GNP's for the world at the eve of WW2

Post by Guaporense » 07 Jan 2015 19:30

China: World's foremost power?

In physical terms China is really impressive, 2013 numbers, thousand short tons unless otherwise specified:

----------- Coal input (2012) ------- Steel output (metric tons) ------ Electricity input (2012, KWH) ------ Motor Vehicle output (units)
China ---- 4,150,656 ------------------ 779,000 ------------------------ 4,467.923 ----------------------------- 22,116,825
USA ------ 889,185 --------------------- 87,000 -------------------------- 3,832.307 ----------------------------- 11,045,902

Not mention manpower:

-------------- Labor force
China ------- 797,600,000
USA --------- 155,400,000

In the "traditional" measures, steel and coal, China's lead over any other country is enormous, much larger than the US's in any period in it's history. The difference in overall industrial production is smaller though, China focuses on producing huge physical quantities (even larger than the US's in per capita terms in many items), while the US produces smaller quantities of higher valued goods.

In overall terms, in 2014, Chinese industrial production added value of 7.1 trillion dollars, US's industrial production added 3.0 trillion dollars, slightly more than 40% of China's.

Considering that currently the US is enforcing it's role as the military hegemon in East Asia I expect that this will change over the next decade. By 2020-2025 China will be the military hegemon in East Asia (at least), when US's industrial production will be between 1/3 to 1/4 of China's. I think they will probably annex Taiwan by that point in time. If war with the US occurs, if the US continues to try to maintain hegemony in East Asia, thing will not be very interesting, China will easily sunk any aircraft carrier in the area, and the bulk of the world's shipbuilding capacity is already in China, Japan and Korea, which means China will outproduce the US in naval vessels by a magnitude similar to the difference between Japan and the US in WW2, or greater. Expect the Pacific war inverted but quicker since in the Pacific war the US didn't focus most of their resources.

Like Nazi Germany and the Soviet Union, China is a dictatorship and they already occupy areas of different ethnic groups like Tibet, it is possible that China will annex Korea, Japan, Taiwan and Vietnam among other Asian countries (and their vast industrial resources, East Asia already has more than 40% of the world's industrial production), and nobody will be able to stop them, their apparent warmaking potential is already enormously superior to any other country. China's relative industrial and manpower strength is much greater than Germany was in WW2, and the world had some difficulty defeating Germany, in China's case I think completely military defeat, with foreign occupation of national territory, is almost impossible. If the US goes to war alone, they will probably end up like Germany in WW2 (if they don't mutually destroy each other with nuclear weapons), if the US makes a coalition with the other powers: EU, Russia, India and Brazil (Japan probably will be under Chinese occupation very quickly in case of war), they might be able to reach a stalemate, but not be able to occupy China like they did with Germany, it's not logistically possible I believe to launch an amphibious invasion over an enemy continent that can mobilize, supply and equip about 130 million soldiers.

Nuclear warheads might be used if the countries get crazy enough, though I believe missile interception technology can evolve to advanced enough that even if a country fires a thousand ICBM on China, over 99% of them might be intercepted and damage might not be catastrophic (like killing a few million people, out of 1.35 billion). Notice also that China already has more engineers than the US or any other country, even if they don't have missile defense systems now, in 10 years they can lead the world. Overall though if war erupts I don't think it will get to the state of mobilization that happened in WW2, be shorter and end with a quick Chinese victory and military control of the Pacific. The US will continue to be the military hegemon of North America and Western Europe and maybe South America.
"In tactics, as in strategy, superiority in numbers is the most common element of victory." - Carl von Clausewitz

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Re: Nominal GNP's for the world at the eve of WW2

Post by Guaporense » 23 Jan 2015 01:29

Guaporense wrote:Some munitions prices:

Germany

Navy:

Ship ------------ cost ------ displacement -------- cost per ton
Bismarck ------ 197 MRm - 41,700 metric tons - 4,724 rm
Tirpitz --------- 181 MRm - 42,900 metric tons - 4,220 rm
Scharnhorst --- 146 MRm - 32,600 metric tons - 4,480 rm
Gneisenau ----- 143 MRm - 32,600 metric tons - 4,386 rm
Hipper ---------- 86 MRm - 16,200 metric tons -- 5,308 rm
Blucher --------- 87 MRm - 16,200 metric tons --- 5,370 rm
Prince Elgen --- 105 MRm - 17,000 metric tons -- 6,176 rm
Type VII* -------- 2 MRm --- 769 metric tons ------ 2,601 rm

From http://forum.axishistory.com/viewtopic. ... 16#p631716)
and http://forum.axishistory.com/viewtopic. ... 77#p628277)

*april 1943 price

Air force:

------------- aircraft ----- cost ------------ weight ---- cost per ton
1942/43 -- Ju 88 A-4 --- 254,496 rm --- 8,550 kg -- 29,766 rm

Source: http://www.econ.yale.edu/growth_pdf/cdp905.pdf, average of the cost of the highest and lowest unit cost for the 1942/1943 fiscal year

Army:

Tank ------------ cost ------- weight-------- cost per ton
Tiger I ------- 299,800 rm --- 56.9 ---------- 5,269 rm
Panther D ---- 129,600 rm --- 43.0 -------- 3,014 rm
Panzer IV --- 115,962 rm --- 25.0 ---------- 4,638 rm
Panzer III --- 103,163 rm --- 23.0 ---------- 4,485 rm
StuG III ----- 82,500 rm ---- 23.9 ---------- 3,452 rm

Source: http://www.panzerworld.net/prices

Note: added the cost of the gun when the price wasn't included, to be comparable to American tank prices

United States

Navy:

Ship -------------- cost ------ displacement -------- cost per ton
North Carolina -- 60 MUS$ -- 37,200 tons -------- 1,613 US$
Iowa ------------- 100 MUS$ -- 45,000 tons ------- 2,222 US$
Submarine ------ 3 MUS$ ----- 1,550 tons -------- 1,935 US$

Air force:

------------- aircraft ----- cost ------------ weight ----- cost per ton
1943 ------- B-25 -------- 151,894 -------- 8,855 kg --- 17,153 US$
1943 ------- B-26 -------- 212,932 -------- 11,000 kg -- 19,357 US$

From: http://www.usaaf.net/digest/t82.htm

Army:

Tank ------------ cost ------- weight-------- cost per ton
M36 ------------- 51,290 ---- 29.0 ---------- 1,769 US$
M10A1 ---------- 43,677 ---- 29.6 ---------- 1,476 US$
M3A3 ----------- 54,533 ----- 14.7 ---------- 3,710 US$
M4A1(76) ------ 51,509 ----- 30.3 ---------- 1,700 US$

Computing the PPP's:

Battleships (RM/dollar): 2.32
Medium bombers (1943 prices): 1.63
Tanks: 1.93

Geometric average: 1.94
Interestingly, from the paper:

Machine tools and mass production in the armaments boom: Germany and the United States, 1929–441, By CRISTIANO ANDREA RISTUCCIA and ADAM TOOZE

We have the following figures for machine tool prices:

US ------------- 5,515 dollars (average 1940-1945 of all machines sold)
Germany ----- 9,811 RM (average price of same bundle of machines according to 1942 German prices)
which wields a PPP in terms of machine tools (and since it the average of a bundle of machines, yields more information than prices for a single machine/item)

imply in a PPP of machine tools of:
RM/dollar = 1.78

I clearly appears that the RM purchasing power in the early 1940's was more than half of a dollar, in terms of prices of aircraft, tanks, industrial machinery and other goods produced by metal working industries. In terms of naval vessels it appears the relative cost of production in Germany was higher, thanks to a much smaller naval industry.

Steel prices also appear to follow a similar proportion. Overall, metal-working industries had relatively lower costs in Germany than in the US, compared to the rest of the economy. Though usually RM/dollar = 2 appears to be a rough indicator of relative cost.
"In tactics, as in strategy, superiority in numbers is the most common element of victory." - Carl von Clausewitz

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Re: Nominal GNP's for the world at the eve of WW2

Post by Freebird » 05 Jul 2015 06:21

Guaporense wrote:
Finally: Is the German GDP figures realistic? It was really twice the size of the British GDP in 1939? .
That would presumably be the figure only for the UK GDP, not including India, the colonies and the Dominions.

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Re: Nominal GNP's for the world at the eve of WW2

Post by Guaporense » 12 Jul 2015 02:01

In PPP terms it was about the same size as the UK+Canada+Australia. India was a big country but it was a subsistence level economy so it's economic output couldn't be mobilized, as result government tax revenues in India were 8% of British even though the country's PPP GDP would be 4/5 of UK's, according to Maddison's estimates.
"In tactics, as in strategy, superiority in numbers is the most common element of victory." - Carl von Clausewitz

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