Paper: New approaches to estimating the GDP of the USSR during the Great Patriotic War

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Paper: New approaches to estimating the GDP of the USSR during the Great Patriotic War

Post by TheMarcksPlan » 06 Jan 2022 11:59

I'm copy-pasting a Google translation of an article I came across, accessible here.

Much is surely lost in translation but the paper, despite making some good points, seems underwhelming. Its core conclusion is that the SU's survival is explained by a shift of investment away from inefficient in the Western USSR (especially the poor territories added in 1939-40) towards more efficient investment in the Soviet rear (Urals, Kuzbas, Karaganda). This seems plausible - Donbas coal seams were old and deep by then, for example - but doesn't seem obvious from the authors' data. Tables 3&4 give investment by country (RFSR, Belarus, rest of SU) and total investment respectively. Combining them we get the following distribution of total investment:

Year: RFSR, Belarus, Rest of SU
1940: 80%, 3.3%, 16.7%
1942: ....................................---> no republic data, total investment 24bn
1943: ....................................---> no republic data, total investment 24.2bn
1944: 74%, 1.7%, 24%
1945: 71%, 2.5%, 27%

I don't see a large trend here, let alone one that explains the SU's survival. Even granting no investment in 1942/3 in inefficient Belarus, that's only a 3% delta to capital flows elsewhere.

The authors state:
In the second half of 1941, colossal investments were made in the USSR
(Table 4), which were made mainly in the economy of the RSFSR, including highly productive
mountain complex of the Urals and Western Siberia. Apparently, they are the "solution" of the reasons
the survival of the Soviet economy: having lost large, but largely unproductive
western territories, the country compensated for them by the rapid development of promising eastern
territories.
But note that total investment in the second half of 1941 (all of which was in the east of course) is less than RFSR investment in 1940 (18.6bn vs. 31.2bn). The authors do not, btw, back up their plausible thesis re Western inefficiency with data on labor productivity there, except regarding household output in the Kresy.

If anyone can read Russian and wants to better explain the logic here, I'm all ears.

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Some good/interesting points:
  • The authors argue that Westerners like Mark Harrison overstate Soviet wartime GDP. I've read Harrison's work and find it convincing but I'd like to read the (Russian language) papers cited in support, if anyone would be so kind as to link them (I can google-translate Russian but no idea how to search in it).
  • They point out that the SU's lack of a large service sector implies it had a lower reserve for wartime mobilization than other countries of similar GDP.
  • Due to a (TBH suspect) estimate that Soviet GDP was lower than most believe, an upwards revision of Lend-Lease's contribution to Soviet war effort.
Body of the paper below:

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New approaches to estimating the GDP of the USSR during the Great Patriotic War

The economy of the USSR during the Great Patriotic War and the whole period of Stalin's rule
continues to attract the attention of researchers exploring the possibilities of planning and
mobilization. In the mainstream of Western science, it is generally accepted that the
1920-1930s Soviet economic policy became a mobilization policy aimed at
"Breakthrough" in socio-economic development. This "counter-modernization" took place by
copying some Western state management practices at the turn of the XIX-XX
centuries in order to achieve the highest indicators of industrial output, which are already
were achieved by the capitalist countries, but in principle without copying the main
capitalist institutions (Kotkin, 1995; Rieber, 2015; Allen, 2009; Chirot, 1991; SanchezSibony, 2014; Nureyev, Gretchenko, 2008; Khanin, 2008). In almost all works, mobilization
the Soviet economy is considered with a plus sign, since in the USSR there was
economic growth and increased growth potential. However, a quantitative assessment of this
growth remains problematic.
Let us remind the reader of the problem of calculating the Soviet GDP of the USSR.
As you know, until 1992, the system of national accounts generally accepted in the West in the USSR was not
was used, which made it very difficult to compare Soviet and foreign macro-indicators.
Soviet scientists have been calculating Soviet GDP in the West (see, for example, Rowen,
Wolf, 1990: 13–92), some of them were intelligence experts. Their assessments of the Soviet
macroeconomic indicators did not differ in accuracy (Khanin, 2016: 21), since Western
researchers did not have access to many Soviet statistical materials. In spite of
modern access to previously classified Soviet documents on economic statistics,
The GDP of the USSR still remains a field for discussion (Khanin, 2016) - as due to the scientific complexity
problems, and due to the fact that open documents are slowly introduced into circulation.
After the Cold War, Angus Maddison took up the calculation of the GDP of the USSR, based on the development
whom Mark Harrison then built his estimates of the GDP of the USSR in the Stalinist period (Harrison,
1988). Currently, M. Harrison turned to another indicator - the national
potential of material production (Harrison, 2017), since it is difficult to
understand the reason for such a long leadership of the USSR in the world, because even at the end of its
the existence of the USSR was 2 times inferior to the United States in terms of GDP (Harrison, 2017). According to M.
Harrison, the gap between the USSR and the USA on the eve of World War II in per capita GDP
(Harrison, 2017) was not very significant: the United States was ahead of the USSR by about 2.2 times.

In our opinion, GDP should not be written off as a tool for analyzing the Soviet economy,
since it reflects not only the level of socio-economic development, but also the nature
consumption in the economy. Small in comparison with the USA, the volume of GDP of the USSR in the 1930s – 1940s. partly
can be explained by the small service sector in the Soviet economy. We offer further our calculation
GDP of the USSR on the eve and during the Great Patriotic War, based on previously little
or generally unexplored Soviet documents, including materials from the USSR State Bank of the first
half of the 1940s. The new approach to assessing Soviet GDP presented in this article
the first half of the 1940s. based not only on new documents, but also on a new methodology,
with the help of which we focus on the inconsistency of the consequences of state
mobilizing the economy, which is achieved by comparing potential and actual GDP
USSR in the period of interest to us.
International experience shows that mobilization (military or peaceful) can cause
not only accelerated growth, but also a decline in GDP or a slowdown in its growth compared to normal
period of development and with the alternative that could come after hour X, do not accept
the leadership of the state decides to start the implementation of mobilization measures. One
Iran in the 1980s serves as a vivid example of this, where negative consequences were caused,
in addition to the failures of the first two years of the war with Iraq, and failures in economic policy (Nikpur,
2018: 71). China in the second half of Mao Zedong's reign (especially during the Great
leap ”of the late 1950s) showed the same decline trends against the background of hyperactive
application of methods of mobilization economy (Butt, Sajid, 2018). You can also remember
a slowdown in labor productivity growth and a decline in energy efficiency at the end
Stalin's rule or the decline in economic growth at the end of the Khrushchev "thaw"
(Popov, 2019), although mobilization methods were actively used in both cases.
The economy of the USSR during the Great Patriotic War (especially in 1941-1943)
demonstrates a seemingly hyper-huge efficiency of mobilization. You can even talk
about a kind of riddle that is often overlooked. After all, the country lost in the first six months of the war
about half of its economically developed territory at the European level, more than 60%
energy raw materials, almost half of the main railways, more than half of the rolling
train and locomotives, 40-45% of the population ended up in the occupation. Leningrad, in which before the war
about a third of the total output of the military-industrial complex was concentrated,
was cut off from the rest of the country by the middle of September 1941. How could such
huge losses of resources the Soviet Union achieved a turning point in the war, fighting with the enemy,
on whose side were the resources of almost all of Europe ?!
During the Soviet period, the phenomenon of growth in military output in the USSR was explained mainly by moral
factor - the superiority of communist ideology and the Soviet worldview over
capitalist. At the same time, macroeconomic indicators were not analyzed too much.
Comparison of the output of military products with enemy states and allied states during the Great Patriotic War was carried out mainly in terms of quantitative
(in pieces), rather than in terms of quality indicators, which is largely due to ideology, otherwise
there would be a significant lag (for example, in aviation technology) from Germany
and the USA. In the post-Soviet period, there has been a shift in emphasis towards the analysis of power
the impact of the political police on the population in the USSR for the supermobilization of labor
resources.
Without denying the contribution of patriotism and Stalinism to the Great Victory, we would like to appeal
to the macroeconomic and especially macro-financial factors of the effectiveness of the Soviet
economy during the Great Patriotic War. After all, it is in economic
the results expressed the selfless work of the Soviet people in the rear. Another important
an aspect of this work is the analysis of the role of the external economic factor of survival
of the national economy of the USSR during the Great Patriotic War.
The purpose of this study is to determine whether the growth of the Soviet economy during the period
World War II reality and, accordingly, were there reserves for this growth in difficult military-economic conditions. For this we turn to the ideas of English
economic historian Alan Milward (1977), with which you can better understand
how, from a macroeconomic point of view, the economy of the USSR differed from the economies of its
opponents and allies (especially the United States and Britain with dominions, since they are in the greatest
degrees retained their market mechanism).
A. Milward's conceptual ideas are that the development of a market economy
in conditions of military mobilization is reduced mainly to the mobilization of those available resources,
which were not involved in a clean market. A. Milward wrote about market
economies put on a war footing, therefore assumed that during the war
strengthening of the state bureaucracy involves reserves and thus works for the growth of GDP,
but it also reduces GDP, since public administration is fundamentally
less effective than market self-regulation. The involved reserves include not
only previously unused resources (for example, mobilizing the unemployed), but also increased
depreciation, which is not used in peacetime (firms do not use in
peacetime machine tools and other production assets "to the last").

Using Milward's Model to Estimate Soviet Pre-War GDP

Although questions about the comparative assessment of the GDP of the USSR and other countries participating in World War II
wars remain controversial, one can conditionally accept
the values of these indicators, given in the works of M. Harrison and A. Maddison. We agree
with M. Harrison and A. Maddison (M. Harrison starts from the calculations of A. Maddison) that
Soviet GDP was less than that of the United States and Great Britain (Table 1), but we consider this
the authors' estimate of the USSR GDP is overestimated, which we will prove further.
Table 1

[INSERT TABLE IMAGE? Reproduces Harrison’s data in The Soviet Homefront]

To determine the Soviet GDP before and during the Great Patriotic War, we use
the formula for GDP growth in the economy of a belligerent country, which was developed by A. Milward (Milward,
1977: 34) based on the theory of J.M. Keynes.
The formula given by A. Milward for the maximum potential GDP of a belligerent
country is as follows:
GDP = p + r + s + e - f, where
p - national product, what it would be in peacetime;
r - internal resources available in a peacetime economy;
s - savings from lowering the capital substitution rate;
e - external resources;
f - losses from reduced efficiency due to the strengthening of bureaucratic regulation.
How to apply A. Milward's formula to the Soviet economy at the beginning of the Great Patriotic War
wars? First of all, it should be borne in mind that the first half of 1941 continued economic
growth, but in the second half of the year there were very large losses of capital and human resources due to occupation of a significant part of the territory. Suppose these two factors offset
each other, so that in what follows, to assess the Soviet GDP in wartime, we will rely on
indicators of the last peaceful pre-war year.
Let us first calculate p in peacetime, in the pre-war 1940, only instead of the national
product (NP), like A. Milward, we will have a GDP.
We do not trust the generally accepted data on the USSR GDP of that period in the mainstream of science.
They are based mainly on the calculations of A. Maddison, who calculated the GDP of the USSR.
in 1990 US dollars.In one of the articles, we showed earlier that attempts to translate the Soviet
GDP of the first half of the 1940s to the dollar equivalent is a rather dubious path
in the historical and economic analysis of the economy of the USSR of that period (Popov, 2016) 1
...
We use the calculation method based on summation to estimate the GDP of the USSR in 1941
added value elements:
GDP = OTR + NPI + VP + VSD, where
OTP - remuneration of employees (wages + bonuses + material benefits) and
social security contributions paid directly by the employer;
NPI - taxes on production and imports (VAT, excise taxes, sales taxes, on land, etc.),
moreover, net taxes are formed by reducing the indicator of general taxes by the amount
subsidies;
GP is the gross profit of the economy, i.e. the sum of the profits of all economic entities;
DChL - income of individuals from those types of private activities where wages
inseparable from the owner's income (we are talking about production without the use of hired labor)
(Tyurina, Shilina, 2008).
Let us now give specific data on archival sources.
OTR in the USSR in 1940, taking into account the specifics of costs associated with wages and social
payments in the planned economy at that time amounted to 52.610 billion rubles. (RGAE, F. 2324, Op.
30, D. 402, L. 25).
NPI in the USSR amounted to 140.2 billion rubles. in 1940 (RGAE, F. 1562, Op. 41, D. 113, L. 181). V
The USSR before the Great Patriotic War, there were no subsidies to the national economy (as
line in the state budget). True, this does not mean that they did not exist at all: almost all
the Soviet economy was already subsidized by that time, therefore the state
costs have been mingled with subsidies. In this sense, subsidies in planned and market
economies are different in nature, so an indicator such as subsidies can
not include in the calculation formula of the USSR GDP in 1940
Before World War II, all profits of enterprises went to their expenses (mainly
investments and financing of social programs for employees), unallocated balance
seized by the state. Taking into account the already mobilization nature of the Soviet
economy in 1940, most of the profits had to be withdrawn by the state in the form of tax,
which was called deductions from profits. They amounted to 21.7 billion rubles in 1940, and we can
fully (with some reservations) be included in the NPI. Profits of enterprises in the USSR in
principle could not be high, taking into account the Stalinist Tax Code, which
was adopted in 1930 and received some amendments in 1936 Profit of enterprises in the understanding
orthodox Marxists was a sign of capitalism, therefore the socialist
the state should have mainly withdrawn the profit to the state budget, so the tax rate on the profit of Soviet enterprises was determined as 81% 2
... Based on the amount of deduction from
profits, it is easy to calculate that the profits left over by the enterprises should have been in 1940.
just over 5 billion rubles. Taking into account the fact that commercial enterprises deducted to the state several
a large share (84% of profit3
), the profit of all Soviet enterprises should be several
below. Therefore, for our calculations, we will conditionally define the VP at 4.5 billion rubles.
Personal income (DCHL) was not so much before the Great Patriotic War.
significant, as in the period of NEP, but not negligible. Private ownership
relations in the economy of the USSR after 1930 were almost absent, but the collective farm markets
continued to function for almost the entire Stalinist period. In this regard, private
subsidiary plots of Soviet collective farmers should be considered as a kind of reserve
survival of the Soviet society. According to the certificate of the head of the Central Statistical Administration of the State Planning Commission from 1946, all
sales on collective farm markets in 1940 amounted to just over 28 billion rubles. (RGAE, F. 7971, Op.
16, D. 354, L. 24) at current prices, which is almost 7 billion more than all deductions from profits
in favor of the state of Soviet enterprises that year4
...

So, our formula for calculating p as Soviet GDP in 1940 took the form:
p = OTP + NPI + VP + DCHL = 52.6 + 140.2 + 4.5 + 28.0 = 225.3 billion rubles.
This corresponds to approximately US $ 18 billion in current diplomatic
the course of the beginning of the Great Patriotic War (Popov, 2016: 45).
To calculate f, the losses of the Soviet economy from the Stalinist model of the state
regulation, we will proceed from the assumption that these losses are associated with ineffective use of
labor force: some part of the labor force (arrested in prisons) was excluded
from production, the other part worked with reduced output (prisoners in camps
Gulag), and free workers did not always work "with full dedication", since
did not have strong incentives to work. Let's try to calculate the difference between the actual
GDP in 1940 and the maximum possible GDP, if all resources were primarily labor
- used in the best possible way. To do this, we will make a calculation of what the annual
the development of ordinary Soviet workers, based on information about labor productivity in
Gulag versus "normal" economy.
In 1941, the leadership of the GULAG determined that a prisoner in the GULAG camp would give
approximately 50% of the output of a free citizen (Barnes, 2019: 191). Such an assessment is,
certainly a result of rounding off a more accurate calculation, but probably not too strong5
...
It is known that in the period 1941-1943. in the Gulag, on average, products were produced per year
in the amount of 3.56 billion rubles (Barnes, 2019: 191). V.N. Zemskov gave the number of
prisoners in the GULAG camps of 1 929 729 people (Zemskov, 1999: 115), which reflects
the situation on the eve of the Great Patriotic War, the still peaceful first half of 1941. Our
an estimate of the size of the able-bodied population of the USSR - about 74.5 million people6
... Consequently, the camp prisoners of the GULAG made up approximately 2.6% of the total working-age population.
USSR before the Great Patriotic War. To calculate the potential
total output in the USSR, we multiply 3.56 billion rubles by 2 (since one free
labor productivity worker is equivalent to two prisoners) and divisible by 2.6
(since 2.6% of the free working-age population were, according to the above data,
able to produce in the conditions of the Soviet economy in the early 1940s. products on
exactly that amount). It turns out that 1% of the free working-age population could release
products per year by about 2.74 billion rubles. in the absence of non-structural shocks in the economy
(as, for example, the occupation of a large part of the territory). This is an indicator of potential
the Soviet economy for the use of labor resources, the maximum possible (in a peaceful
time) productivity of the working-age population. Consequently, in 1940, all 100%
able-bodied population of the USSR could have been created (if many were not in prisons and
camps, and many free workers did not shirk) production for about 274 billion rubles.
This is significantly more than our estimate of the USSR GDP in 1940 at 225.3 billion rubles. The gap is
approximately RUB 49 billion, i.e. reserves were about 22%.

GDP of the Soviet military economy by A. Milward

Thus, for the formula of GDP of the economy of a belligerent country according to A. Milward, where
GDP = p + r + s + e - f,
we have p = 274 billion rubles. (we take here the potential GDP in 1940) and f = 49 billion rubles.
Let us try to estimate r, available internal reserves in the economy, and s, savings on
intensive exploitation of the production park.
The easiest way is to estimate the parameter s. It was calculated by A. Milward for the market
economy, but in the case of the planned economy of the USSR, this element of GDP growth can
just be absent. Indeed, under the conditions of the Soviet planned economy, machine tools and
equipment, as well as buildings, were used, as a rule, always (not only during the war)
for a very long time, almost to complete wear and tear, which was due to the lack of competition. Were,
exceptions, of course, but they did not change the overall situation. Therefore, with some reservations
we propose to define s = 0.
When analyzing the parameter r, it should be borne in mind that in the Soviet planned economy r (available
internal reserves) are combined as a percentage of GDP, additionally appeared as a result of
reducing the negative impact on the economy from f (in particular, sending to
front in 1941, a significant part of the Gulag prisoners, which freed from mobilization
part of the workers in the army), and the mobilization of resources, primarily labor, including,
of course, an increase in the labor input of women and adolescents in the national economy. It should also
take into account that those remaining in the unoccupied territories in the civilian sector
production assets had to serve a smaller population,
since more than 80 million Soviet citizens ended up in the occupied territories. At that
the same time r in the Soviet economy could not appear, as in the USA and Great Britain, due to
attracting unemployed and part-time workers to production, since unemployment in the USSR
did not exist. The movement of labor resources from the village to the city, which was observed at the beginning
World War II in Western countries, it was in the USSR during the Great Patriotic War
very limited, this is established by historians on the basis of an analysis of the situation with labor
resources for individual regions in 1941-1945. (Konyshev, 2018: 216). This situation was
caused by low productivity in agriculture, as well as its low total
factor productivity in general (Sinitsyn, 2017: 45), which forced the state
to retain as many workers as possible in the countryside by administrative means. Also
most can be said about the limited relocation of labor resources between civil and
military industries: labor on the latter in the USSR was far from always attractive, the mobilization mechanism also worked with certain severe restrictions (Danilov,
2014: 115; Kozurman, 2010: 104), since the population of large and medium-sized Soviet cities was not
in the 1940s. great.
According to S.A. Barnes, the prison population remained as a percentage of the rest
able-bodied population of about 3% constantly throughout the Great Patriotic War
war, despite the decline in the "population" of the GULAG: because of the occupation and high mortality
the number of employed people has greatly decreased (Barnes, 2018: 191), so r due to
the decrease in prisoners could not increase. In addition, the mass release of political
prisoners were very difficult, as the authorities sought to isolate some
segments of society (not only, for example, white army veterans, but also kulaks), considering
them as potential collaborators and agents of enemy intelligence.
An increase in the efficiency of the administrative apparatus during the war was observed, but
it was unlikely that it was significant for the initial period of the war, if we do not take into account
organization of evacuation of enterprises. According to various estimates, according to the USSR GDP, it has not
reached the level of 1940 before the end of World War II. All this indicates that the high
there was no effect of state centralization in terms of GDP growth (although it is possible
was the effect of increasing military output while reducing the production of civilian
products). Therefore, we can argue that in the Soviet economy during the war years, r = 0.
Let us now consider the parameter e - external resources, i.e. economic assistance to the USSR from
allies. Undoubtedly, Lend-Lease played a significant role in the Soviet military economy,
which should be reflected in the indicator e of A. Milward's formula.
Under Lend-Lease, the USSR received production for the entire period in the amount of 11.3 billion US dollars
at current prices. According to the diplomatic course (Popov, 2016), this amounted to 141.25 billion rubles,
which is more than the GDP of the USSR in 1942 or in 1943. If we now divide the total amount of Lend-Lease by
4 years of war, then we can take the annual value e = 35 billion rubles. For more accurate
accounting must take into account that products coming from Western countries were used
at the front and in the national economy, most often not immediately, but after several months, as
this, for example, happened with the delivery of most of the military aircraft in the last quarter
1941 g.
So about all at once, in 1941, a potential Soviet GDP (on the one hand, excluding
losses of population, territories and production assets, as well as, on the other hand, excluding
growth in the first half of 1941) can be estimated as follows:
GDP = 274 + 35 - 49 = 260 billion rubles.
The method for estimating real GDP for the USSR during the war period will be presented below (see.
tab. 2). We only note that the available reserve of 49 billion rubles. due to conscription and losses
territories and their population that fell into the occupation was used in the first year of the war
far from completely. Continuing repressive measures - for example, continuing the practice of arrests
for minor misconduct and large-scale political repression (deportation
Volga Germans) - significantly reduced the economic efficiency of the work of the Stalinist
bureaucracy.
Let's compare the reserves for the war in the USSR and Western countries.
If, according to our calculations, the gap between potential and real GDP in the USSR on the eve of
World War II was approximately 22%, then in the United States, according to modern estimates
based on the calculations of E. Hansen, made by this leader of American Keynesians in 1938,
it was 23.1% (Gordon, Krenn, 2010). Accordingly, it was a reserve for military growth.
the American economy amid a fairly high rate of productivity growth
labor - 2.7% per year, which is 2 times more than in the United States in the period 2004–2014. (Gordon, Krenn,
2010). At the beginning of World War II, unemployment in the United States stood at 15%, which also
created a certain reserve for mobilization. But this reserve arose as a result of an unsuccessful
the work of the market mechanism in the crisis of the 1930s, and not disruptions in the work of the bureaucratic
apparatus, as it was in the USSR.

Dynamics of the USSR GDP during the war period

The dynamics of GDP throughout the Soviet period is highly controversial. The most reliable method
calculations of the USSR GDP in the period of interest to us, in our opinion, is the multiplication
Base year GDP by a coefficient reflecting the change in the volume of railway
transportation in ton-kilometers. Of course, this method can only give an approximate
estimation of the dynamics of GDP, but often used calculations of GDP through price changes - the method
even more doubtful, which we have shown on the example of the assessment of Lend-Lease in historiography
(Popov, 2016).
It is known from various sources that in 1940 the USSR transported 415-420 billion ton-kilometers of cargo. Take the maximum value of 420 billion tonne-kilometers as 100%, or
unit coefficient, then we will present the dynamics of GDP as follows (tab.
2). In this table, the calculation of "GDP including Lend-Lease" is made on the basis of the assumption of
uniformity of supplies. Since in fact, in 1941-1942. supplies were still small,
and in 1943-1945. they have grown, then estimates of the GDP of the first years of the war are made here with some
overestimation, and in recent years - with underestimation.

table 2

[TABLE 2 – Compiled from: (National Economy of the USSR, 1990, page 175]

Our reasoning, given in table. 2, coincide with the consolidated data for
the rate of industrial production in the USSR in 1929-1950, described by S.V. Smirnov. By
his estimate, since the second half of 1941, the increase in industrial production in relation to
by the previous year it began to fall (in the last quarter of 1943 it turned out to be almost zero),
which lasted almost until the winter of 1944-1945. After a peak in the first half of 1946,
recession began again, which lasted almost until the end of the Stalinist period (Smirnov, 2012:
24). These data, described by S.V. Smirnov, may seem mysterious, since the USSR since the winter of 1942 has constantly significantly increased the output of military products. Obviously speech
is about the consequences of a sharp decline in the output of civilian products, as well as the "relief"
samples of Soviet weapons, which reduced the cost of materials and energy per unit
manufactured products.

The answer to the "survival" of the USSR

The question of how the USSR survived in 1941-1943 remains unanswered so far. with huge losses
territories and population. We include among them the actual economic loss of Leningrad,
whose industry since the winter of 1941-1942. worked much weaker than even in October
1941 In addition, in the spring of 1942, another mass mobilization took place in the USSR among
industrial workers, which created a difficult labor situation in industry by the summer
the same year.
The difficult situation in the economy of the USSR was observed in the future, up to 1944.
we see from the data in table. 2, a turning point on the fronts of the Great Patriotic War of 1943
the year was not such in the economy of the USSR, the growth of GDP this year turned out to be insignificant. We
we explain this in many respects by the mobilization of men and complete destruction in the second half of the year
1942 of Stalingrad, which until the end of the war was never restored along with its large
industrial potential.
To explain the riddle of the "survival" of the USSR, it is necessary to pay attention to the high
territorial heterogeneity of the country. It is well known that the regions of the USSR were almost
the end of the existence of this state were developed very unevenly. In Stalin's
period, there were much stronger imbalances than after 1953.
Attention should be paid, for example, to the fact that the new western territories,
annexed in 1939, they had a very weak economy. In the western regions of Ukraine
after September 1939, the Soviet government was forced to urgently create industrial
artels. It turned out to be difficult to nationalize industry here, since
under the Poles, a significant volume of output was carried out by small family handicraft
enterprises. In this regard, we present an interesting fact illustrating the state of Western
regions of the USSR occupied during the first month of the Great Patriotic War: 833
industrial artels of Western Ukraine with 33,500 workers employed in them gave in 1940
of products for 11.2 million rubles, which amounted to 16% of the value of the entire industrial output
the western Ukrainian territories annexed to the USSR (Petrovskaya, Borisenok, 2011: 158).
Accordingly, the entire industrial output of these territories in 1940 amounted to 70 million rubles.
at current prices. This amount looks dwarf against the background of the fact that the entire volume of heavy
industry of the USSR in 1938 had a value of almost 100.4 billion rubles. in prices of 1926/1927
(Harutinyan, Markus, 1940: 649), and in the current prices of 1938 this indicator should have been
above.
As a result of the rapid loss of Western Ukraine and Western Belarus (where there were
similar problems), the Soviet government did not need to make budget
investment in these very backward areas. Investments were directed at much
more economically efficient regions of the Urals and Western Siberia9
so the household
the necessity and lack of alternatives of choice defeated politics.
So, after June 1941, investments began to move from inefficient Western
regions that were lost to much more efficient central and eastern ones. Even
in 1944-1945 investments in the BSSR were less than before the war. True, in the Ukrainian SSR
capital investment significantly exceeded the pre-war level (Table 3), which was associated with a key
the importance of Donbass and DneproGES for the national economy of the USSR, which were necessary
urgently restore.

Distribution of investments by republics, billion rubles

1940 1944 1945
RFSR 31.2 21.6 25.1
Belarus 1.3 0.5 0.9
USSR (rest?) 6.5 7.1 9.5



[TABLE 3 – Compiled from National Economy of the USSR, 1990, page 95]

In the second half of 1941, colossal investments were made in the USSR
(Table 4), which were made mainly in the economy of the RSFSR, including highly productive
mountain complex of the Urals and Western Siberia. Apparently, they are the "solution" of the reasons
the survival of the Soviet economy: having lost large, but largely unproductive
western territories, the country compensated for them by the rapid development of promising eastern
territories.

Table 4
Dynamics of investment in the national economy and industry of the USSR in 1941-1944
[compiled from Chadayev, 1985, p.167 – Which book is this?]

Total investment, bn rubles
1941- 2nd half 18.6
1942 24
1943 24.2
1944 33
1945 40.7


CONCLUSION
The decline in GDP could have turned out to be even greater in the belligerent USSR, had it not started to improve
management. An important reserve of the Soviet economy was the optimization of management
processes and improving the quality of bureaucratic management as a whole, which, however, practically
cannot be expressed in macroeconomic indicators, since the effects of an increase
the quality of management in financial terms was "repaid" during the war by losses
human and material resources. However, before the Great Patriotic War, the USSR did not
there were large reserves, which we explain by the pre-war mobilization of the economy, especially
partial mobilization in 1940. If, for example, the United States had such a reserve in the form of an extensive
civilian sector, then the USSR did not have such an advantage. In this regard, we would say
that the small volume of per capita GDP (in comparison with Western democracies and the Nazi
Germany) did not leave the USSR with large real reserves in the economy for mobilization.
As a hypothesis explaining the economic "survival" of the USSR, one can take
such a factor as the formation of "defense-industrial" clusters in the central regions
countries as a result of evacuation (first of all, we mean Kirov / Vyatka, Chelyabinsk,
Magnitogorsk and Kazan). This was, apparently, the main reason for the exit of the Soviet military
the economy from the crisis in 1943
We also highlight strong imbalances between the western and central regions.
The USSR on the eve of the war as a factor that allowed the Soviet economy to survive in conditions of large
territorial losses. Investment flows in the Soviet economy were redirected
from the western regions lagging behind before the war (this is especially true of the former Polish territories
and the Baltic republics annexed in 1940) to the Urals, the Volga region and Western Siberia. A loss
Donbass was, of course, painful, but the geological features of Donbass were already in
The First World War did not make this coal basin highly efficient in terms of profitability of production. During the Great Patriotic War, the USSR at a rapid pace
developed Kuzbass, the geological conditions of which were much better.
The contribution of Stalinism to the economic side of the Great Victory lies in how we do
the conclusion from all of the above, not so much in the military as in the pre-war mobilization
National economy. By the beginning of the war, there were already ready-made military production, although some
these industries had to be moved from one region of the country to another due to losses
western regions.
With regard to the ability of the Stalinist model of a planned economy to provide economic
growth under wartime conditions, here the USSR was noticeably inferior to Western democracies. Links to
colossal losses of territories and population should not be considered a full-fledged excuse (although
this, of course, also played a role), since, we repeat, many occupied
Soviet territories were not of great economic importance before the Great Patriotic War
war. For comparison, we can say that the loss by the Western allies of almost all
Southeast Asia with its mineral reserves in the first half of 1942 provided
much more painful effect on their economies than on the Soviet national economy
temporary loss of Ukraine, Belarus and the Baltic republics.
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historygeek2021
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Re: Paper: New approaches to estimating the GDP of the USSR during the Great Patriotic War

Post by historygeek2021 » 18 Feb 2022 23:50

Good find. I have not seen any other authors mention that the far western territories of the USSR in 1941 contributed virtually nothing to its industrial output, nor that the USSR had been trying inefficiently to invest in these territories prior to the German invasion.

The Germans did not reach industrially vital areas of the USSR until the second half of August: Krivoy Rog and Nikopol. And it took until September or October for the Germans to reach other industrially vital areas: Leningrad, Moscow area and eastern Ukraine. This gave the Soviets plenty of time to transition industrial production to the Urals and western Siberia.

It's also interesting to hear that Donbass was not as efficient as Kuzbass, which was close to the Mongolian border and thus hopelessly beyond the reach of the Wehrmacht. If Hitler had known the importance of Kuzbass, he may have retired and become a painter rather than start a war he couldn't win.

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