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Output growth in German manufacturing, 1907–1936. A reinterpretation of time-series evidence

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  • Veenstra, Joost

Abstract

This study uses state space time series analysis to estimate output growth in German manufacturing between 1907 and 1936. In the absence of net-output data, previous research has estimated output change using proxy variables. Various proxy-based output series are available that imply either a 25% German labor-productivity lead over Britain or a parity of performance in 1907. The conventional strategy to deal with this conundrum involves a choice between the series. With the correlation between the different proxies and output unknown, such a choice is inappropriate because it results in the loss of information provided by the rejected proxies. Instead, this study makes full and efficient use of all information by estimating a common component in the various output series. The new estimate of output change implies a German lead over Britain in manufacturing labor productivity of 4.4% in 1907.

Suggested Citation

  • Veenstra, Joost, 2015. "Output growth in German manufacturing, 1907–1936. A reinterpretation of time-series evidence," Explorations in Economic History, Elsevier, vol. 57(C), pages 38-49.
    • Handle: RePEc:eee:exehis:v:57:y:2015:i:c:p:38-49
    DOI: 10.1016/j.eeh.2015.03.001
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    More about this item

    Keywords

    Time series; state space models; comparative economic history; production; manufacturing; Germany;
    All these keywords.

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • N14 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Europe: 1913-
    • N64 - Economic History - - Manufacturing and Construction - - - Europe: 1913-
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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